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kajeet, MTV in spat over content deal

Content deals are great for cellular subscribers, but sometimes they can go awry. We saw that recently as MTV has sued kajeet for breach of their content contract. The lawsuit centers around a $14.2 million agreement the two parties signed in 2006, $2.5 million for licensing and $11.7 million for kajeet advertisements on MTV. The lawsuit was filed on Friday in federal court in Manhattan.

The strangest part is how this lawsuit arose. According to MTV, kajeet stopped payment on their contract, which is probably reason enough for a suit. In addition, the MVNO signed a similar agreement with Cartoon Network, owned by Time Warner. The deal included licensing rights to characters like SpongeBob Squarepants and Rugrats, which are copyrights owned by Nickelodeon, an MTV affiliate.

Says the complaint:

Kajeet has breached and defaulted under the agreement by refusing to pay past due and outstanding invoices, indicating it ‘wants out’ of its agreement with MTVN while still using MTVN content past the expiration of its license.

Without a thorough knowledge of the case, I’ll reserve all comment. I did email kajeet CEO Daniel Neal for comment, but received no response.