UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MARYLAND

____________________________________
                                    )
ProActive Media, Incorporated       )
5601 Grosvenor Lane                 )
Bethesda, Maryland 20814            )
                                    )
v.                                  )   Civil Case No._________
                                    )
The Walt Disney Company             )
Burbank, California 91521           )
                                    )
Registered Agent:                   )
                                    )
The Corporation Trust Company       )
1209 Orange Street                  )
Wilmington, Delaware 19801          )
____________________________________)


VERIFIED COMPLAINT FOR INJUNCTIVE AND MONETARY RELIEF

Plaintiff, Proactive Media, Inc. publishers of the electronic
business daily Multimedia Wire, by counsel state and allege the
following claims against Defendant, The Walt Disney Company.

Jurisdiction and Venue

      1. This is an action for the willful violation of federally
registered copyrights owned by Proactive Media, Inc. and
protected under the 1976 Copyright Act, as amended. 17 U.S.C. s
101 et seq. This Court has jurisdiction over this matter pursuant
to Sections 1338(a) of the Judicial Code of the United States. 28
U.S.C. Section 1338(a). Venue is appropriate as provided by 28
U.S.C. Sec. 1391(b)(2).

Overview

      2. This suit alleges regular and premeditated copyright
infringement by representatives of Disney Interactive Software,
an unincorporated division of The Walt Disney Company. Upon
information and belief, a senior executive of Disney Interactive,
David Rech, instructed his secretary to copy each day's single
paid-for copy of MMWIRE and had unauthorized duplicates
distributed to Disney executives throughout Disney offices in the
U.S. and Canada. It is alleged that this was done to avoid paying
additional subscription fees. At the time the infringement was
revealed (by an anonymous caller from within Disney), the number
of Disney personnel receiving infringing copies was in the
dozens.

Parties

      1. Plaintiff ProActive Media, Inc. (hereafter "PMI") is now
at and at all times relevant to this suit, a corporation
organized under the laws of the state of Maryland with a
principal place of business at 5601 Grosvenor Road, Bethesda,
Maryland 20814. PMI is in the business of publishing a daily
electronic newsletter known as Multimedia Wire ("MMWIRE").

      2. Defendant, The Walt Disney Company, is an entertainment
company which, upon information and belief, is a corporation
organized under the laws of Delaware. It maintains its principal
place of business at 500 South Buena Vista Street, Buena Vista,
California 91521.

Background Facts

      3. MMWIRE is an electronic business daily published by PMI.

      4. Christopher V. Sherman is President and founder of PMI.

      5. MMWIRE is a daily newsletter, prepared for the time-
pressed business reader, and devoted to the burgeoning field of
electronic and interactive entertainment. MMWIRE has a special
focus on gaming, on-line entertainment and CD-ROM based
technologies.

      6. MMWIRE provides the business reader with information
concerning acquisitions, sales, mergers, strategic alliances,
technology collaborations and other news and analysis. Readers
value the publication as providing original reporting on
important industry developments and as a source for commentary
and analysis of developments affecting this volatile industry.

      7. PMI staff begin work on MMWIRE at about 9:00 A.M. on the
day preceding a publishing day. This work continues throughout
the day with staff gathering information and finishing the
edition each night between 11:00 P.M. and 1:00 A.M. The product
is then transmitted to a service bureau for mass fax and e-mail
distribution to the hundreds of subscribers who pay for this
timely access to information.

      8. PMI staff gather data from a growing network of contacts
and professionals in the industry who regularly share information
with the company. In addition, staffers scan a wide array of
sources including news and wire services, press announcements,
industry specific news feeds, and other standard news sources.
The network of individual sources established by Mr. Sherman and
his staff is the direct result of years of interviews and related
personal contact efforts. The MMWIRE staff has access to this
pool of individuals and institutions because it regularly
exchanges and shares information. PMI deems these resources to be
one of the most valuable aspects of the company. The newsletter
reflects a personalized approach to the news by including the
names of specific industry contacts for each story as well as
phone numbers for these individuals. MMWIRE is an information
service providing news to readers which in most cases has a very
short "shelf-life." Delivery is made each day by 7:00 A.M.
Eastern Standard Time and MMWIRE is one of the first publications
its readers consult each morning. In many cases, the news MMWIRE
reports will become a topic of discussion on very day it is
released. In fact, on July , the established daily Variety
reported that a key development involving the Dreamworks
multimedia outfit was first publicly reported by MMWIRE. It is in
part because of the time-sensitive nature of what MMWIRE delivers
that makes it so important that the company protect the
exclusivity and short term value of the publication. MMWIRE
readers pay a fair, but sizeable, subscription fee of
approximately $500 per year to have timely access to the news and
analysis MWIRE offers.

      9. MMWIRE was launched by Chris Sherman out of his home in
June of 1994. He has worked hard to build the subscription base
since that time. The company was founded using his personal
savings and continues to grow. Expansion has been steady and
recently culminated in national recognition of the contributions
MMWIRE has made to understanding the business developments
affecting the gaming and interactive entertainment industries.
"Wired" magazine's June edition included an article touting
MMWIRE as "required" reading for key players in the multimedia
business.

The Infringement

     10. On June 12, 1995, MMWIRE editor Sherman was working in
the editorial offices preparing the next day's edition when he
received a phone call.

      11. The caller made no introduction and immediately asked
who they were speaking to. Sherman identified himself by name and
indicated he was the editor of MMWIRE.

      12. The caller asked whether he (Sherman) would "be
interested in infringement" at her employer, Disney Interactive.
The caller relayed that she was "sick" of what she saw as a
"double standard", and expressed annoyance at the fact that
Disney regularly pursues others for infringement when Disney
itself was copying MMWIRE. Mr. Sherman was impressed by the fact
that this caller was calm and very deliberative in her speech.
There was no hesitation or uncertainty; she seemed to know
precisely what she was doing in contacting PMI and advising it of
what she saw as improper and illegal conduct. In this call, she
asked if Sherman would like to see David Rech's distribution
list. Mr. Sherman knew Mr. Rech as a subscriber to MMWIRE and a
senior executive of Disney Interactive. Sherman said he would be
very interested and the caller asked for the PMI fax number. It
was provided and the conversation ended.

      13. A few moments later, the PMI fax machine began printing
out a fax, a copy of which is attached to this Complaint as
Exhibit A. Sherman presumed this fax was from the anonymous
caller who had just warned about "infringement". The fax
consisted of two pages, on the first was the following: "Chris:
This is a copy of the distribution list from David Rech to his
associates. This has been going on since last year and the list
of names has been growing ever since." The second page of the fax
was captioned " MMWIRE Distribution List" and consisted of the
names and locations of thirty-five (35) individuals who,
according to the anonymous caller and page two of the fax, were
receiving illegal copies of MMWIRE.

      14. Sherman was very upset at this because Disney was
believed to be a valued subscriber to MMWIRE, but pays for only
four legitimate subscriptions. As of the June 12th call,
ProActive records reflected Disney as having the following
subscriptions and for each is listed the subscriber contact, the
designated destination for the newsletter, the desired delivery
method (E-mail or facsimile) and the subscription commencement
date. Notably, Disney was aware it required separate
subscriptions to separate destinations as evidenced by its Hong
Kong affiliate subscription.

Disney History Of Subscribers:

Name: David Rech        
Title: Dir. Sales
Delivery Method: Fax
Date: August 22, 1994
500 S. Buena Vista
Burbank, CA 91521

Name: Bob Lambert
Title: VP New Tech & Dev.
Date: October 27, 1994
500 S. Buena Vista
Burbank, CA 91521

Name: Sarah Meltzer
Title: Ass't Mgr.
Delivery Method: Email
Date: April 27, 1995
Email Address: 100426.513@compuserve.com
The Walt Disney Co.
  A/P Ltd.
15/F Citibank Tower
Citibank Plaza
3 Garden Road
Central, Hong Kong

Name: Gary Graeper          
Delivery Method: Email
Title: Ass't
Date: May 15, 1995
Email Address: g_graeper@studio.disney.com
1400 Air Way
Glendale, CA 91209


      15. In examining the June 12th fax, Sherman noted its
origin from Los Angeles, California (based upon the area code),
and the transmittal legend on the fax indicates "Accounting Buena
Vista, Inc."

      16. From Sherman's knowledge of the multimedia industry, he
knew that Disney operates Buena Vista, Inc. as one of its
divisions. He concluded that the fax, and likely the anonymous
call as well, originated from within the accounting department of
Buena Vista, Inc.

      17. On the same afternoon as he received the fax, Sherman
decided to call the number listed on the top of the second page
captioned "MMWIRE Distribution List." Under this header was the
invitation "To be added to distribution please contact Tammy
R[....][FN1] 8223 4375." Sherman sought to confirm that there
really was a "Tammy R[....]." One of the reasons he did this was
because he was so shocked at the size of the distribution and the
comments of the anonymous caller, he thought some hoax or
practical joke might be being played on him.

      18. Sherman concluded that the number listed for Ms.
R[....] on page two of the fax was an internal exchange number
because there was no dialing prefix and the number of digits was
not the usual seven or ten. Using industry directories, Sherman
located and called the main number at Walt Disney. He asked to
speak with Ms. Tammy R[....] and his call was transferred. The
person answering the phone was a young woman who identified
herself as Tammy R[....]. Ms. R.'s existence as a Disney employee
confirmed to Sherman that the fax was authentic and that it had
indeed come from within Disney. Sherman also noted that the voice
of Ms. R. was not the same as the anonymous caller who sent the
fax. After Ms. R. identified herself, Sherman became nervous
about the seriousness of this situation and promptly ended the
call.

      19. That same afternoon, Sherman consulted with counsel.

      20. After discussions with Disney representatives failed,
this suit was filed.

COUNT I: COPYRIGHT INFRINGEMENT

      21. Plaintiff repeats, realleges and incorporates by
reference the allegations contained in paragraphs 1 through 22.
Plaintiff, PMI, has created the copyrighted publication MMWIRE
for the exclusive use of its authorized subscribers.

      22. Plaintiff PMI in compliance with the Copyright Act of
the United States (17 U.S.C. 101 et seq.) as applied for and
received from the United States Copyright Office a certificate of
registration for MMWIRE. A true copy of which is appended hereto
and incorporated herein by reference as Exhibit B.

      23. Plaintiff PMI has also applied for registration (on a
nonexpedited basis) of other copies of its daily newsletter.
These are pending and in process at the Copyright Office.

      24. Plaintiff PMI is the sole and exclusive copyright
proprietor and owner of the entire right, title and interest in
and to PMI's MMWIRE publication and all forms of it.

      25. Upon information and belief, PMI alleges that Disney
has without a basis in law or contract made unauthorized copies
of copyrighted MMWIRE publications to avoid compensating PMI
fairly for this use. Specifically, the infringement includes (1)
making unauthorized copies, for distribution in its Los Angeles,
California offices, and (2) making unauthorized copies and
transmitting and displaying these copies by virtue of its daily
facsimile transmissions of the Los Angeles copy of MMWIRE to
Canada and the central and eastern United States. It is further
alleged that the act of faxing the work constitutes actionable
copying as well.

      26. At no time has PMI authorized Disney to copy, store,
reproduce, make daptations of MMWIRE or otherwise utilize MMWIRE
in any way other than that llowed under applicable copyright law.

      27. Plaintiff PMI is entitled to recover from Disney all
damage suffered as a result of Disney's wrongful and willful
infringement of its copyrights, although at this time ProActive
is unable to ascertain the complete extent of the copying and the
use of its publication. It is believed that discovery will
provide additional information confirming the scope of damage
suffered by PMI.

      28. PMI is entitled to recover, at its election, damages
from defendants including the maximum statutory damages allowable
under the Copyright Act for this willful infringement and in
addition, seeks compensation for all attorneys fees and costs
expended in this action.

COUNT II: BREACH OF CONTRACT

      29. PMI repeats, realleges and incorporates for reference
the allegation contained in paragraph 1-30.

      30. By the terms of the subscription agreement between PMI
and Disney, Disney was an authorized recipient of the precise
number of copies for which it had contracted for and paid. It was
never authorized to make any other uses of the copyrighted work
and all copyrights were and continue to be expressly reserved to
PMI.

      31. Disney breached the terms of its contract with PMI by
exceeding the scope of permissible use of MMWIRE.

      32. PMI has been damaged by this breach in an amount to be
determined at trial.

RELIEF

      33. WHEREFORE, Plaintiff respectfully prays for the
following relief:

      a. The Defendants, their officers, agents, servants,
employees and all persons acting under their joint and several
direction, control, permission, license or acting in concert or
participation with them be enjoined and restrained perpetually
from i) violating or inducing others to violate or contributing
to the violations of PMI's copyrighted MMWIRE publication; ii)
using, copying, reproducing, making adaptations of or diversions
from or alterations to the MMWIRE publication in a manner which
exceeds the permitted fair use afforded Disney under the 1976
Copyright Act 107. 35 U.S.C. 107; and

      b. That Plaintiff be granted all relief allowed under
504(B) of the Copyright Act; or

      c. The Plaintiff be granted all relief allowed under 504(c)
of the Copyright Act; and

      d. The Plaintiff be awarded all damages suffered by virtue
of Defendant's intentional breach of its subscription contract
with Plaintiff; and

      e. The Defendant's be ordered to account and pay over to
Plaintiff all gains, profits and advantage derived or realized by
them individually and collectively from their violations of
Plaintiff's copyrights and their wrongful conduct as alleged
herein; and

      f. This Court award the Plaintiff, and the Defendant's be
ordered to pay the full costs of this action, including
reasonable attorneys fees as provided in 505 of The Copyright
Act; and

      g. This Court enter judgment against Defendant's in the
form of a $2 million punitive and exemplary award to deter others
from engaging in such willful and intentional violation of the
intellectual property rights of others; and

      h. The Plaintiff have such other further and different
relief as the Court deems just and appropriate.

Final Verification

      I solemnly affirm under the penalties of perjury that the
contents of the foregoing paper are true to the best of my
knowledge, information and belief.

Respectfully submitted,

PROACTIVE MEDIA, INC.

By:/s/Christopher v. Sherman
Christopher V. Sherman
President & Chairman
5601 Grosvenor Lane
Bethesda, Maryland 20814

COUNSEL TO THE PLAINTIFF

Shulman, Rogers, Gandal, Pordy & Ecker, P.A.

By:/s/ James A. Powers, Esq.
MD U.S. Dist. Ct. Bar No.: 07502
11921 Rockville Pike
Third Floor
Rockville, Maryland 20852-2743

DATED:  August 8, 1995

STATE OF MARYLAND       )
                        )
COUNTY OF MONTGOMERY    )


FOOTNOTE:


FN1: The identity of Ms. R. is known and is being withheld from
this complaint and related documentation to protect this innocent
employee. Her identity is known to Disney's counsel.