NBC's newly acquired Oxygen Network lost its first battle in federal court this week against American Youth Symphony (AYS), producers of America's Hot Musician, to have the case dismissed.

The suit (case no.1:07-cv-01280) which will be fought in the U.S. District Court for the Southern District of New York, had been stalled for about three months pending the court's December 31st ruling.

According to court records, at issue is that Oxygen, owned by Oprah Winfrey at the time of the filing, issued a cease and desist letter demanding that AYS refrain from using Oxygen's name in advertisements for America's Hot Musician, a paid program which was to debut on the network on July 7, 2007. AYS contends that Oxygen effectively canceled the program and frustrated its agreement by such a demand because AYS could not reasonably promote its paid program to advertisers and fans without being able to state where the program was airing.

Television shows are typically produced and promoted by the networks themselves but many networks also sell their airtime in half hour blocks to independent producers for productions such as religious broadcasts and infomercials.

In a statement, AYS artistic Director Gregory Charles Royal said: "This whole scenario is so ridiculous to think that any person with common sense would even think they could sell someone real estate and expect them not to tell their customers what address the building is on. Then to add insult to injury, Oxygen's original attorney threatens us with countersuits and full court onslaughts by the all powerful NBC attorneys. We just want to settle the matter and suggest that in the future, Oxygen accept the inherent price, like other stations do, for making a profit from selling paid program time or stop selling it".

"Musician", which has been shot all the way through to the semi-final round, features solo instrumental musicians vying for a one-year recording contract, and currently airs as a broadband television program on its www.americashotmusician.org website and on iTunes with voting set to begin January 9th.

The program offers a true musical dialogue between contestants and the judging panel that includes violinist Marissa Regni from the National Symphony Orchestra, former Kittie bassist Talena Atfield and Royal, a Duke Ellington Orchestra alum and trombonist from the Broadway musical Five Guys Named Moe. Vocal performances are not allowed.

American Youth Symphony is a Washington, DC area based "think tank" whose mission is to promote instrumental music in the MTV/Hip Hop generation.