Deadline owner Jay Penske takes Nikki Finke to arbitration

The battle between entertainment journalist Nikki Finke and Jay Penske, the owner of Deadline Hollywood, the website she founded and has since left, has been turned up a notch.

Late Monday, Penske Media Corp., whose holdings include Deadline Hollywood and Daily Variety, said it was initiating arbitration with Finke, which means a third party will resolve their differences.

Finke departed Deadline Hollywood earlier this month after clashing with Penske over multiple issues, and said she was going to start her own site that would cover Hollywood news.

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Though Finke said there was nothing legally stopping her from launching a new site (dubbed NikkiFinke.com), Penske Media insiders said that was not the case and that technically she had a non-compete agreement until her contract with the company expires at the end of 2016.

Penske Media said in a statement that it had launched arbitration against Finke to “enforce its covenants not to compete and to obtain monetary damages for numerous breaches of her contractual agreements with the company.”

The company added that “several reasonable business attempts to resolve the dispute have failed, and the company plans to enforce all of its rights to the fullest extent under the law.”

Reached for comment, Finke said, “One minute they tell me I’m terminated. Then they tell me I’m not terminated three days later. Now they’re telling me they are initiating arbitration. It’s like, if it’s Tuesday, it must be another development that they backtrack on.” She added that “this is a matter for the lawyers to handle.”

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Penske Media acquired Deadline Hollywood, known for its biting commentary about the industry and occasional harsh critiques on prominent executives, in 2009. Initially, Finke and Penske seemed to have established a decent working relationship. Deadline boosted its staff after Penske Media acquired it, adding several reporters and editors.

But when the company also bought the trade paper Variety in 2012, the relationship between Penske and Finke fell apart. Finke claimed she was promised a role in overseeing Variety. When that didn’t happen, she often used Deadline to attack Variety and Penske. She also complained publicly that Deadline Hollywood was being shortchanged financially as Penske put more resources into Variety.

“There were a lot of broken promises, contractual and verbal, which matter to me and didn’t seem to matter to him,” Finke told The Times two weeks ago.

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Twitter: @JBFlint