Bizarre moment Kyle Sandilands is taken to task by PROTESTERS outside court - over a completely unexpected issue - as he launches blockbuster $85m lawsuit over sacking

Radio star Kyle Sandilands was heckled by anti-vax protesters as he left court following the first hearing of his landmark $85million legal fight against his former employer ARN. 

Sandilands, dressed in a black suit and tie, on Friday commenced action in the Federal Court alleging that ARN - the parent company of KIIS FM - deliberately sabotaged his $100million contract. 

He claimed the blow-up with Jackie 'O' Henderson that led to his sacking cannot constitute serious misconduct because such behaviour was encouraged by his employer. 

At a case management hearing on Friday the shock jock's barrister Scott Robertson SC said Sandilands's case was 'fairly confined'.

Mr Robertson said the matter would turn on whether a now infamous exchange Sandilands had with Henderson on The Kyle & Jackie Show on February 20 amounted to 'serious misconduct'. 

Following the brief hearing, Sandilands was addressing the media outside court when he was heckled by a group of women yelling about 'the constitution' and a man filming him on his mobile phone confronted him.

As Sandilands turned his attention to him, the man asked: 'Are you guilty by association during the Covid times and the vaccine?'

A visibly baffled Sandilands said 'we've got the loon brigade', turned around and walked away. 'The bloke's yelling about Covid, I don't know what that is'. 

Prior to the incident, Sandilands denied reports that he'd had conversations with Henderson. 

'Contrary to popular reporting, I haven't spoken with Jackie,' he told the assembled media. 

He admitted he regretted what he said to her on February 20 - comments alleging that his co-host was 'off with the fairies' - which prompted Henderson to storm out and ARN to blow up his 10-year deal with the network. 

Sandilands alleges ARN sacked him in a calculated attempt to exit the costly agreement after little more than 14 months. 

Inside court, Mr Robertson said Sandilands was encouraged to engage in 'robust' behaviour on air and his conversation with Henderson could not be deemed serious misconduct.

He noted that if ARN had objected to what Sandilands said to Henderson the comments could have been stopped from going to air by pressing the dump button.

'This isn't a case of a royal commission into Mr Sandilands and his previous career,' Mr Robertson told the court.

Mr Robertson said Sandilands was seeking reinstatement but ARN's attitude was that 'the world's moved on'.

'He's happy to turn up on Monday morning and continue to do his show,' Mr Robertson said.

Mr Robertson said the termination of Sandilands's contract was invalid and he was entitled to be paid what he was owed.

Tom Blackburn SC, for ARN, said the court could not force the network put Sandilands back on air and described the action as 'just a claim for debt'.

Mr Blackburn said Sandilands had defied directions in the past and his conduct had impacted ARN's broadcasting license.

He said if an employer were to sack a worker for drunkenness that person's past behaviour would have been considered when determining what action was appropriate.

Mr Blackburn also accused Sandilands of trying to 'jump the queue' by having his case expedited.

Justice Angus Stewart set the matter down for a second case management hearing on April 25.

Sandilands arrived at court on Friday with manager Bruno Bouchet about half an hour before the first case management hearing was set to start at 9am. 

Sandilands said his sacking was 'traumatic' and added about his contract: 'It shouldn't have been terminated.'  

'(I'm) just happy that we can get in today and get this ball rolling,' he said outside the Federal Court.

'I just want to get back to work as quick as possible - I've got a family to support.'  

His legal team is led by the 'ferocious' Kevin Lynch, a partner at Johnson Winter Slattery, while ARN is being represented by the firm Herbert Smith Freehills Kramer.

On Monday morning, ARN issued a statement to the ASX, asserting the network disputed Sandilands's claims and planned to defend the action.

'The applicants claim the termination of Mr Sandilands's contract was invalid on the basis they allege that there was no act of serious misconduct or breach of contract, and that the termination was unconscionable under the Australian Consumer Law,' their statement read.

'The applicants seek an order for specific performance of two contracts, payment of whatever amounts are due and payable under the contracts at the time of judgment, and damages.'

Behind the scenes, ARN's newly appointed CEO Michael Stephenson has been trying to persuade Sandilands's former co-host, Jackie 'O' Henderson, to return to KIIS FM with a solo show.

The pair's 25-year-old broadcasting partnership imploded on February 20 when Sandilands slammed Henderson over what he described as her 'fixation' with astrology.

ARN is reportedly hoping to bring back Henderson at a much lower rate with a new program, after the network also terminated her own $100million deal last month.

Henderson is apparently not enthusiastic about that offer, while sources close to the former co-hosts say she intends to watch how Sandilands's legal offensive unfolds.

The end of the Kyle & Jackie O show was announced on Wednesday last week when Sandilands released a statement at 7am announcing that KIIS's parent company had terminated his contract.

'ARN has just announced they've terminated my contract,' he said. 'I don't accept it.'

'My lawyers told them last week this would be invalid. And guess what? It is.'

An hour after Kyle's bombshell statement, ARN chief executive Michael Stephenson sent an email to staff announcing The Kyle & Jackie O Show had been axed.

'This morning, ARN announced that it has issued a notice of termination of contract with Kyle and Quasar Media,' the email read.

'As a result, ARN will no longer present the Kyle and Jackie O Show.'

ARN announced last month that Henderson's $100million contract had been terminated after she told allegedly executives she 'cannot continue to work with Mr Kyle Sandilands' following an on-air blow-up.

Henderson and Sandilands were discussing Andrew Mountbatten-Windsor on February 20 when she read out the disgraced royal's birth chart.

Sandilands then lambasted his co-star, claiming  her love for astrology was affecting her work.

As Henderson protested, Sandilands continued: 'It's affecting other things, like your fixation on this has made you almost unworkable. You're off with the fairies with this s***t. It's mental.'

Henderson said she was offended by Sandilands's comments.

'I am, Kyle,' she said. 'I totally am offended by you saying something like that.'

Sandilands responded: 'Well, too bad if you are because that's the reality of what we're dealing with here. It's affecting everything else. You're too fixated on it.'

Henderson became audibly emotional, fighting back tears as she continued to defend herself.

'I would never say things like that about you,' she said.

'It's a total attack, it really is… to say: 'You don't know what the F is going on, you're not doing your job,' that's an attack and I wouldn't do that.'