SecProbe.io

<DOCUMENT>
<TYPE>CORRESP
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<FILENAME>filename1.txt
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September 4, 2009

John Reynolds
United States Securities and Exchange Commission
Division of Corporation Finance
100 F Street, N.E.
Washington, DC 20549

RE:  Stratus Media Group, Inc.
     Supplemental Correspondence Submitted July 6, 2009 Re Forms 10-K and 10-K/A
     For Fiscal Year Ended December 31, 2008 and Form 8-K filed March 14, 2008
     Form 10-Q for the Fiscal Quarter Ended March 31, 2009
     File No.:  0-24477

Dear Mr. Reynolds:

This letter is in response to the above. The following responses are numbered to
correspond to the comments made in your letter of July 24, 2009, which appear in
italics as a means of reference:

     1.   We note in your response to comment 4 in our letter dated May 22,
          2009, that generally the Company reviews the value of intangible
          assets and related goodwill in February or March, as part of its
          annual reporting process. Please disclose the as of date on which the
          annual impairment test of your reporting units is conducted.

The tests are conducted as of December 31 of the year being reported, which we
will make clear in the disclosure.

     2.   We note the assumptions by reporting unit in your response to comment
          4 in our letter dated May 22, 2009. We further note the reasons you
          believe each intangible asset is recoverable in your response to
          comment 13, and your response to comment 16 on the event acquisition
          liabilities. In light of the fact that your events and the Stratus
          Rewards program have not generated any substantial revenues since you
          made the respective acquisitions over the course of 1998 through 2005,
          please expand your disclosure to explain the basis for your
          determination that each event will take place by the year designated
          in your response and how you will find a sponsor for and re-commence
          the Stratus Rewards program by 2010. In addition, tell us the basis
          for your belief that the events would generate profits in addition to
          revenues.

We believe that the events carried as intangible assets on the balance sheet
will generate revenues and be profitable because they were profitable when they
were acquired by Stratus and the Company has demonstrated that it can operate
events in a profitable manner.

<PAGE>

The following chart shows each event with an intangible value on the balance
sheet and the peak revenue and gross margin that each event achieved prior to
acquisition. It should be noted that most events while privately owned tend to
commingle business and personal expenses in an attempt to minimize profitability
and the attendant tax liability, and that once owned by the Company we have or
intend to eliminate those personal expenses in an attempt to maximize
profitability.

<TABLE>
<CAPTION>
                                             Pre- Acquisition Peak Year Results (rounded to nearest thousand)
                                            -------------------------------------------------------------------
                                Peak Year              Revenues          Gross Margin $           Gross Margin %
                             -------------- ---------------------- ---------------------- ---------------------
<S>                                   <C>             <C>                    <C>                         <C>
Long Beach Marathon                   1998            $ 2,300,000            $ 1,326,000                 57.7%
Freedom Bowl                          1996              3,603,000                607,000                 16.8%
Athlete management                    1999              1,150,000                375,000                 32.6%
Santa Barbara Concours                2000                880,000                229,000                 26.0%
Concours on Rodeo                     2001              1,304,000                274,000                 21.0%
Core Tour                             2002              2,300,000                667,000                 29.0%
Maui Music Festival                   2000                923,000                203,000                 22.0%
                                            ---------------------- ----------------------
                                                     $ 12,460,000            $ 3,681,000                 29.5%
                                            ====================== ======================
</TABLE>

Of the above events, only the Core Tour events and a smaller-scale Concours on
Rodeo were run by the Company after being acquired. The following table shows
the revenues and gross margin for these two events, along with the results for
the Stratus Rewards program after it was acquired by the Company:

<TABLE>
<CAPTION>
                                                             Post Acquisition (rounded to nearest thousand)
                                 Period     --------------------------------------------------------------------------
                                Operated                Revenues             Gross Margin $         Gross Margin %
                             -------------- ------------------------ -------------------------- ----------------------
<S>                              <C>                    <C>                          <C>                        <C>
Core Tour                         FY 2004               $ 1,457,406                  $ 379,930                  26.1%
Stratus Rewards                  8/05-10/07                 517,620                    517,620                 100.0%
Concours on Rodeo                    7/07                   129,259                     53,139                  41.1%
                                            ------------------------ --------------------------
                                                        $ 2,104,285                  $ 950,689                  45.2%
                                            ======================== ==========================
</TABLE>

In addition to the above, a Superbowl-related event was held in the first
quarter of 2008 with revenues of $33,606 and direct costs of $24,679, for a
gross margin of 26.6%, which we believe further underscores the Company's
ability to conduct events profitably.

With regard to the expected timing of conducting the events, the disclosure in
the 10K will include the following:

"With regard to the timing of the events in these forecasts, the Santa Barbara
Concours event will be held October 31 to November 1, 2009. Most events are held
during the summer months and require approximately six months of lead time to
adequately plan the event. We believe that with the receipt of adequate funding
by the end of 2009, we will have more than sufficient time to plan and execute
the Concours on Rodeo, Core Tour and Maui Music events for the summer of 2010.
To allow for the NCAA approval process, we deferred the assumed start of the
Freedom Bowl until 2011."

With regard to re-commencing the Stratus Rewards program, the disclosure in the
10K will also include the following:

<PAGE>

"We have hired an experienced bank executive as Vice President of Stratus
Rewards with the sole responsibility to obtain one or more new banks as partners
in the program and to relaunch the program by 2010. After becoming acquainted
with the Stratus Rewards program, this executive identified 19 financial
institutions as potential partners with the Company in the Stratus Rewards
program. Following discussions with each institution, it was determined that:
five serve as exclusive outsourcers to other institutions only or use
outsourcing and do not make program decisions; two have their own high-end
cards; and four declined for various reasons (no co-branding, policy of avoiding
high-end market, etc.). Of the eight remaining institutions, five have received
a request for quotation and are in active discussions regarding partnering with
the Company on a co-branded Stratus Rewards program and three are in the
preliminary stages of discussions but have indicated an interest in moving
forward. Given this dedicated resource to obtaining one or more partners for the
Stratus Rewards program, the strong interest in pursuing partnership by five
institutions and the active interest by three other institutions in pursuing
partnership, the Company believes strongly that it will be able to find a
sponsor for and re-commence the Stratus Rewards program by 2010."

     3.   We note in your response to comment 16 in our letter dated May 22,
          2009, that pursuant to the terms of the Concours on Rodeo and Core
          Tour/Action Sports Tour Asset Purchase Agreement you are required to
          make cash payments to ensure that these assets can be utilized without
          additional legal action by the former owners. With respect to the
          Concours on Rodeo and Core Tour/Action Sports Tour intangible assets
          of $600,000 and $1,067,069, respectively, please explain to us how you
          determined these to be assets. In that regard, explain why you believe
          you have acquired the right to the license agreements or control of
          the license agreements when you cannot utilize them without legal
          action being taken by the former owners.

In re-reading our July 4, 2008 response to comment 16, the response should have
read "without threat of additional legal action," rather than "without
additional legal action." The Company held a nationally advertised, but
smaller-scale, Concours on Rodeo event in the third quarter of 2007 that
resulted in $129,259 of revenues and the Company did not hear anything from the
former owners.

The acquisition of Concours on Rodeo closed on June 18, 2004, which resulted in
Pro Sports & Entertainment, Inc. (the predecessor company to Stratus Media
Group, Inc.) acquiring 100% ownership in Concours on Rodeo, LLC, which in turn
owned the rights to the venue on Rodeo Drive in Beverly Hills and a number of
registered trademarks, including "Concours on Rodeo(R)," "Beverly Hills
Concours(R)," and others. As consideration for this acquisition, the Company was
required to pay $600,000, with $200,000 around the time of closing, $200,000
around the time of the 2005 Concours on Rodeo event and $200,000 around the time
of the 2006 Concours on Rodeo event. The Company paid $200,000 in cash at the
time of closing but has not made the remaining payments because the 2005 and
2006 Concours on Rodeo events were not conducted.

The acquisition of Core Tour closed on February 4, 2004 and resulted in the
Company acquiring 100% of Core Tour LLC, which has exclusive license and
ownership of venues and trademarks relating to the Core Tour Events.
Consideration paid by the Company for this acquisition was $200,000 cash at
closing, $200,000 cash payable within 30 days of closing, a percentage of gross
revenues and sponsorship receipts and a series of consulting payments to the
former owners. Of the $1,067,069 required as consideration, the Company paid
$583,351 in cash but was unable to complete the remaining $483,718 due to
liquidity constraints. This remaining payment owed by the Company led to the
lawsuit by the former owners and the resulting settlement agreement dated May
11, 2006, which was subsequently superseded by an agreement dated July 31, 2008
that extended the payment date to December 31, 2008 and called for the accrued
interest to be paid to the former owners through the issuance of the Company's
common stock. This stock has been issued to the former owners.

<PAGE>

In both the Concours on Rodeo and Core Tour acquisitions, the Company paid
substantial amounts of cash consideration, obtained full ownership of the LLC
that ran each event and in turn acquired all the intellectual property for each
event. With regard to the Concours on Rodeo, and event has been held using
related intellectual property without any mention of legal action by the former
owners. As noted below, the settlement agreement reach with Core Tour
specifically leaves ownership of the Core Tour assets with the Company, even in
the event that the Company defaults in payments to the Core Tour. Accordingly,
the Company believes it is appropriate to book these acquisitions as assets.

     4.   We note in your response to comment 16 in our letter dated May 22,
          2009, that you did not make the $482,126 payment in cash to the
          previous owners of the "Core Tour" by December 31, 2008 and that you
          expect to conclude a modification to allow for the delayed payment of
          this amount. Please disclose the consequences of not making the
          payment in the event that you do not come to such an agreement with
          the previous owners.

The Settlement Agreement and General Release among the Company, Core Tour LLC
and the Core Tour Partners dated July 31, 2008 ("Core Tour Agreement") sets
forth the requirement of a cash payment by the Company to the Core Tour Partners
of $482,126.30 in Section 2(a) and the requirement that the Company issue
$144,100 worth of the Company's common stock to the Core Tour Partners to settle
accrued interest and penalties.

Section 12 of the Core Tour Agreement states: "The Core Tour Parties represent
and warrant that they will only file for a Use or Return of Judgment with the
Court in the event the conditions set forth in Paragraph 2(a) and Paragraph 2(d)
of this Settlement Agreement, and all conditions set forth in the Entry of
Judgment, are not met."

Section 14 of the Core Tour Agreement states: "This Settlement Agreement,
including the fully executed exhibits identified herein, contains the sole,
complete, and entire agreement and understanding of the Parties concerning the
matters contained herein...nothing herein shall affect the ownership rights of
any property owned by Pro Sports, intellectual or otherwise, except as provided
in the Entry of Judgment." The Judgment referred to in the Core Tour Agreement
required payment of the $482,126.30, plus accrued interest and penalties, and
did not require the Company to relinquish its ownership in the Core Tour assets.

Therefore, the disclosure in the 10K will include:

"If the Company is not able to agree on a timetable for payment of the $482,126
and/or is not able to pay the Core Tour parties, the Core Tour parties have the
right to enforce their judgment against the Company in that amount, but under
the terms of the settlement agreement, the Company retains all rights to the
Core Tour assets."

<PAGE>

     5.   We note in your response to comment 17 in our letter dated May 22,
          2009, that the accounts payable written off in 2007 and 2008 of
          $560,549 and $20,642, respectively, were originally "set up in error"
          in 2003 and 2004, respectively, and that you determined this upon an
          extensive review of accounts payable. Please tell us how you
          considered SFAS 154 with respect to the accounts payable set up in
          error and written off in 2007 and 2008, in determining whether to
          correct the error in a restatement to your financial statements.

In re-reading our July 4, 2008 response to comment 17, the use of the phrase "in
error" was a poor choice of words and the structure of the explanation should
have paralleled the explanation for the removal of the Snow and Ski Tour
acquisition liability in the paragraph immediately above.

The payables were not set up in error and, as noted in our July 4th response,
they were established in anticipation of events being held in 2004 and 2005 that
were subsequently canceled. Given that these payables were regarded as valid and
the California statute of limitations is four years for enforcement of a written
contract, the Company and its auditors kept these payables on the books for 2005
and