Busted case finally makes it to court
Artists , Contract / March 2008
UK

CONTRACT Artists The claim by two original members of boy band Busted, Ki McPhail and an Owen Doyle, that they were forced out of the band and made to sign away lucrative intellectual property rights in songs has finally reached court. The action, dating back to the early days of Busted in 2002, has come about as McPhail and Doyle say that before being pushed out they co-wrote some of the hit songs that appeared on Busted’s eponymous and very successful debut album. As a result they want a cut of the royalties those songs have generated. Both claimants signed an agreement on their departure giving up all claim to the band’s intellectual property, but both now claim that agreement should be set aside for various reasons, including the fact that they allegedly weren’t told of Universal’s interest in the band and their music before entering into the agreement and that their management owed them a duty as their managers to not let them sign such a foolish contract. It appears that their then managers not only let them sign the agreement but actually wrote it too. There is a further allegation that the contract was signed under duress. McPhail…

Fleetwood loses claim for BBC masters
Contract , Record Labels / March 2008
UK
USA

CONTRACT Record labels Mick Fleetwood of Fleetwood Mac has lost his long-running legal battle against the Beeb in relation to the distribution rights of session recordings from the BBC’s archives. The dispute was between Fleetwood’s company Bee Load Ltd and the BBC’s commercial division BBC Worldwide. The former entered into a contract with the latter back in 2001 giving Fleetwood’s company the right to release CDs featuring various BBC recordings of artists like Bruce Springsteen, U2, The Who, The Stones, The Beatles, Elton John, Santana and Led Zeppelin. The relationship fell apart in 2003, though, and Fleetwood claimed the Beeb were in breach of contract for refusing to work with his company, and sued through the US courts for damages (Bee Load being primarily based in the US). However, a judge in Maine last week ruled in favour of the BBC, concluding that it was Fleetwood’s business partner, Joseph McNulty, who caused the business deal to fault, because he became “obsessed” with gaining exclusivity rights for distributing the BBC recordings, even though such rights were not part of the 2001 deal. BBC Worldwide, the judge ruled, did everything they could do to make the deal work despite McNulty’s obsession with…

Experience Hendrix LLC and another v Times Newspapers Ltd
Artists , Contract / February 2008
UK

CONTRACT Artists Experience Hendrix LLC which represents the interests of the Jimi Hendrix estate claimed it was the owner of (i) the performer’s rights in the performances given at the Royal Albert Hall ( London, England) in February 1969 by Hendrix, and (ii) the copyright in the sound recordings of those performances. Experience sued the publisher of The Timesnewspaper, saying that the publisher had infringed its rights by authorising and procuring the manufacture, and the issuing to the public, of compact discs featuring copies of those recordings. The Times denied infringement, pleading that the allegedly infringing acts had actually been licensed. The basis of the defence was the existence of a chain of licences, beginning with a letter from the mid to late 1970s, which gave it a defence under section 180(3) of the Copyright, Designs and Patents Act 1988, which states: “The rights conferred by this Part apply in relation to performances taking place before the commencement of this Part; but no act done before commencement, or in pursuance of arrangements made before commencement, shall be regarded as infringing those rights “. Experience applied for summary judgment on the ground that The Times had no reasonable prospect of defending the claim; The…

High School Musical star’s claim to avoid contract signed as a minor goes to trial
Artists , Contract / January 2008
USA

CONTRACT Artists A lawyer who claims “High School Musical” lead Vanessa Hudgens owes him $150,000 in legal fees can proceed with his lawsuit against the teen star, a US judge has ruled. Superior Court Judge Tricia Ann Bigelow said she or a jury should decide whether the actress acted within a reasonable period of time when she waited two years to repudiate a contract she signed when she was 16. Attorney Brian Schall filed a breach-of-contract lawsuit in September that said Hudgens agreed in October 2005 to pay him 5 percent of her earnings in exchange for his legal representation. Hudgens earned more than $5 million with his help, Schall says in his lawsuit. Hudgens disavowed the agreement on October the 9th and she turns 19 later this month: her current attorney argues that state law provides that a contract with a minor can be voided before the person turns 18 or “within a reasonable time afterward.” http://www.startribune.com/entertainment/12195876.html

New contract dispute for Hawthorne Heights
Artists , Contract , Record Labels / December 2007
USA

CONTRACT Artists, record labels Emo types Hawthorne Heights are facing another lawsuit while their ongoing and much previously reported legal dispute with Victory Records continues reports the excellent CMU Daily. The new legal run in is with Wild Justice Records who are suing for breach of verbal contract. They claim that in January they reached a verbal agreement to manage the band – and that the band agreed to pay a 16.5% commission on any revenues the company generated for them. That agreement, Wild Justice claim, was put into a written contract which was given to the band, who, they say, didn’t object to any clauses but who never returned a signed copy. However, Wild Justice began working in a management role nevertheless, and the company and the band operated under the terms of the agreement until May when the band changed their mind and, the plaintiffs argue, “improperly terminated” the arrangement. The management firm are now seeking $138,000 in damages plus a percentage of revenue from booked concerts, merchandise sold during those concerts and a Mountain Dew sponsorship, as well as “fees” for band instruments acquired and an $800 loan to the band. The band are yet to comment….

Meatloaf fans seeks compensation for cut-short show
Contract , Live Events / December 2007
UK

CONTRACT Live events A ticket holder at that recent Meat Loaf concert in Newcastle Upon Tyne where the rock legend walked off stage early because he was suffering from what turned out to be a cyst on his vocal cords is planning legal action to force promoters to give ticket refunds, and he is encouraging others to join him.  Promoters have said that Meat Loaf had performed for 70 minutes before ill health forced him to leave the stage, and that as such they do not deem it necessary to refund ticket holders, even though he did not complete the whole planned concert. However, one fan, Mike Fisher, who paid over £50 for his ticket, claims that Meat Loaf actually only performed for 40 minutes and that that is not enough to justify the ticket price. He says his calls to the venue, promoter Kennedy Street and ticket seller Ticketmaster to discuss a refund have not been returned, and now he plans to take the case to the city’s small claims court, and he hopes to persuade other ticket holders to back his action. He told local newspaper The Northern Echo: “I am proposing that since we are not getting…

Hannah Montana fan club member sues over implied ticket promise
Artists , Contract / December 2007
USA

CONTRACT Artists By Mark P Holmes Numerous US websites reported that the fan club of the American teen pop sensation Miley Cyrus, daughter of Billy Ray Cyrus and star of the successful ‘Hannah Montana’ TV show, was being sued by a disgruntled fan after thousands of fan club members failed to secure tickets to see the singer on her latest tour. After certain fans were left empty handed New Jersey resident Kerry Inman filed the suit “on behalf of all members” citing an ‘implied promise’ that membership implied assured access to the tickets. Fans, she says, were “deceptively lured…into purchasing memberships” worth $30 on the basis that members would be granted “priority access” to purchase tickets for Miss Cirus’s tour when they went on sale. The two issues on which the case should turn appear at least on the face of it, pretty straightforward: firstly does ‘priority access’ mean ‘guaranteed access’ to a ticket. The answer is surely that in the context of being given the opportunity to purchase something, it simply suggests a ‘better chance’ than a non-member of purchasing a ticket. Any argument that this somehow constitutes a promise, and that therefore by extension the terms are interchangeable…

Genuwine litigates to get out of ‘fraudulent’ contract
Artists , Contract / November 2007
USA

CONTRACT Artists Ginuwine has filed a lawsuit filed in Manhattan’s state Supreme Court saying that he was duped into signing a contract in May 2007 with a company, the King Music Group Inc., which doesn’t exist. The King Misic Group was allegedly owned by a personal acquaintance of Genuwine’s, Michael Bourne and t he terms of the contract gave Ginuwine (real name is Elgin Baylor Lumpkin) $1.75 million to record his first album a $500,000 advance. In nearly five months the singer hasn’t made any records and hasn’t been paid a cent, the lawsuit said. The lawsuit further alleges that there are no corporate records for King Music Group Inc. anywhere in New York, California, Florida or Tennessee. The lawsuit accuses King Music and Bourne of breach of contract, fraud and negligent misrepresentation. It asks for a total of $4 million in damages. Genuwine was previously signed to Epic. http://www.billboard.com/bbcom/news/article_display.jsp?vnu_content_id=1003653658

Does Diddy owe on a Biggie debt?
Artists , Contract / November 2007
USA

CONTRACT Artists Blimey, another rap suit. P Diddy is being sued by a former colleague who claims he is owed monies relating to a Notorious BIG recording from in 1994. The plaintiff is James Sabatino who previously worked as a consultant for Diddy’s Bad Boy, and who personally paid for Biggie, to fly to Miami to perform live and record songs back in 1994. Because he paid for the trip, Sabatino had a deal with Wallace that he would own the recordings made that day. Enter Diddy who allegedly agreed to buy the recordings in 1997 after Biggies untimely death in for $200,000 of which $25,000 was paid. Then Sabatino was declared to be “of interest” to LA police investigating Biggie’s murder and so Diddy promptly put his deal with Sabatino on ice. Since then Sabatino has since been cleared of any involvement in Biggie’s murder although he was jailed over a totally unrelated matter. And now he wants his $175,000 for those 1994 recordings. CMU Daily 8 October 2007 http://www.thebeatsbar.co.uk

Nugent loses appeal over concert cancellation
Contract , Live Events / November 2007
USA

CONTRACT Live events industry The Michigan Court Of Appeal has rejected an appeal by rocker type Ted Nugent who sued music festival Muskegon Summer Celebration after they cancelled a 2003 booking with his band Amboy Dukes after he made allegedly racist remarks in a radio interview. Promoters of MSC cancelled the planned Amboy Dukes set at their 2003 event after a local newspaper reported on the radio interview, comments Nugent had made, and opposition by some local residents to what he had said. They said at the time of the cancellation that “any use of potentially offensive racial terms such as those attributed recently to Ted Nugent do not reflect the spirit of Muskegon nor the Summer Celebration”. Nugent sued the MSC not only for breach of contract over the cancellation but also for libel, slander, “detrimental reliance”, unfair competition and unjust enrichment. The breach of contract claim, heard by a jury, was successful, but a Muskegon County Circuit Court judge dismissed all the other allegations. Nugent appealed that decision, but the Court Of Appeals upheld the dismissals last week. Not only that, but they reduced the compensation awarded to the rocker over the breach of contract claim. At first…

Ex Snow Patrol bassist brings legal action
Artists , Contract / October 2007
UK

CONTRACT Artists Snow Patrol’s former bassist Mark McClelland has announced that he is issuing legal proceedings in the High Court against the rest of the band for songwriting royalties and gig earnings dating back to 2005 and beyond, including those from the band’s breakthrough album ‘Final Straw’ and last year’s ‘Eyes Open’. McClelland left the band alleging creative differences. Source UnLimited/CMU http://www.thebeatsbar.co.uk

US appeal court overturn Rod Stewart cancellation case: Rod Stewart’s agent, lawyer win appeal
Artists , Contract , General , Live Events / August 2007
USA

CONTRACT Live event industry, artists ARTICLE LINK : by Susan Butler The California Court of Appeals has overturned the decision of the Los Angeles Superior Court who awarded £$1.6 million in damages from the cancellation of Rod Stewart shows against Stewart’s agent and lawyer. However the appellate court affirmed that Stewart must re-pay $780,000 paid to him as deposits for a number of cancelled South American shows and $472,000 in legal fees to the promoters. http://www.billboard.biz/bbbiz/content_display/industry/e3i9aaa6659e3c485e76d40847f87a5bf38

Busted bust up still a dust up
Artists , Contract / May 2007
UK

CONTRACT Artists The Universal Music Group has been brought the legal action involving former UK chart topping boy band Busted which has been brought by two former members Ki Fitzgerald and Owen Doyle who were axed before the band became successful. The label is added as new matters include allegation that the axed members’ vocals appeared in on the band’s 2002 album Busted released by the major. Fitzgerald and Doyle have already claimed that they were integral in the creation of the Busted franchise, coming up with the name and co-writing some of the band’s early hits. They claim they were unfairly cut out of the equation by manager Richard Rashman and that Rashman failed to fulfill his contractual commitments as a manager to protect their interests by making them sign agreements on their departure that greatly favoured Rashman and remaining band members, James Bourne and Matt Willis. Fitzgerald and Doyle’s 2005 legal action seeks a cut of the royalties from the band’s early songs and trademark use. Rashman, Bourne and Willis are named as defendants. The claimants are also looking at the band’s US trade mark registration which is allegedly held in Rashman’s personal name. The High Court has ordered evidence…

Heritage band name dispute drifts towards the High Court
Artists , Contract , Trade Mark / April 2007
UK

TRADEMARK / CONTRACT Artists The Drifters are one of the longest serving groups in the history of popular music – and hits like Under The Broadwalk., Saturday Night at The Movies and Save The Last Dance for Me have made them pretty influential as well. But now members in the current line up – who are amongst the fifty or so singers who have been in the Drifters, face a legal action from the wife of the band’s ex-manager who claims she owns the right to the name The Drifters. Faye Treadwell claims she is the legal owner of the name – which her husband brought from the original band in 1954 – and that he ran the band as a business, employing various signers to tour and record as The Drifters. Ms Treadwell is bringing an action in the UK against the band known as the Drifters (who themselves have lodged UK and European CTM trade mark applications for the name) and in the USA against a number of ‘Drifters’. A number of states in the USA have already passed laws protecting ‘heritage acts’ saying that at least one original member must be still involved. Recent band name disputes involving original members included…

Ongoing Management Commission gets Seal of Approval : Wadlow v Samuel
UK

CONTRACT Artists ARTICLE  By Charlie Anderson, Solicitor, Clintons  The Court of Appeal this week upheld the 2006 judgment in the case of John Wadlow v Henry Olusegun Adeola Samuel (pka Seal). The recording artist failed to persuade the Court of Appeal that a 1995 agreement ending his relationship with Mr Wadlow, his former manager, was procured by undue influence. The Court of Appeal dismissed the appeal on 28 February 2007 and confirmed the validity of   the contract for Mr Wadlow, who was represented by Clintons solicitors. Mr Wadlow discovered Seal in the 1980s and invited him to record some songs at Beethoven Street Recording Studios, which he then ran. In 1988 Seal signed a publishing deal with Mr Wadlow’s publishing company and in 1990 the pair signed a management agreement that provided perpetual post-term management commission to Mr Wadlow on the albums recorded during the life of the contract. In 1995, after the release of two highly successful albums, and as Seal’s career was increasingly based in the US, they amicably parted company and drew up a “settlement agreement” which terminated the management agreement. Under the settlement agreement Mr Wadlow made several valuable concessions, including the return to Seal of the publishing rights…

Its no knickers – Dame Kiri wins cancellation case
Contract , Live Events / April 2007
Australia

CONTRACT Live event industry Opera star Dame Kiri Te Kanawa has won a court case in Australia after she cancelled a 2005 tour because she feared that she would be bombarded with underwear – as the planned co-headliner with Aussie veteran John (‘the Voice’) Farnham. Dame Kiri had seen a DVD of his shows where he caught underwear thrown by fans. Promoter Leading Edge had sued for A$2m (£815,000), claiming it had lost money on publicity costs and ticket sales but New South Wales Supreme Court Judge Patricia Bergin rejected the claim ruling that while there were emails in which venues, fees and air tickets for the proposed concerts were discussed, no firm commitment was made and no contract was finalized. Leading Edge said it had spent more than A$380,000 (£155,000) on preparations for the concerts, only to find that Dame Kiri’s agent former, Mr Grace, knew the singer was wavering on the performances but had failed to pass on the information. However Judge Bergin ordered Mattane, the company that employed Dame Kiri, to pay Leading Edge A$128,063 (£52,000) for costs incurred as the company had not been entirely honest in its dealings with Leading Edge. Comment: This type of case…

Victory Records expand Hawthorne Heights litigation
Artists , Contract , Record Labels / February 2007
USA

CONTRACT Artists, record labels Independent rock label Victory Records has extended its Hawthorne Heights litigation by now suing the record company established by frontman JT Woodruff called Carbon Copy Media. The US band fell out with Victory Records, the label they were signed to, last year, and sued the record company and its boss Tony Brummel for breach of contract, seemingly in a bid to release themselves from their contractual commitments to the independent. The band subsequently signed a new recording deal with EMI’s Virgin Records division. But a court ruled back in September that the band remained bound by its exclusive recording contract with Victory, in theory barring them from entering into their new deal with EMI. Band members have pledged to appeal that ruling but Victory have begun legal proceedings against EMI, claiming EMI persuaded band members to launch the original breach of contract lawsuit in a bid to free them from their Victory commitments . The new litigation against Carbon Copy Media follows on from a distribution deal between Victory and Carbon Copy with Victory distributing releases from bands Ellison and Signal Home, and Woodruff’s pre-Hawthorne H eights band A Day In The Life. Victory claim they spent more than $200,000…

Sports agents are ‘less essential’ than Artist Managers Proform v Proactive
Artists , Contract / December 2006
UK

CONTRACT Artists ARTICLE  Tom Frederikse, solicitor, Clintons The High Court has confirmed its quite different view of sports agency contracts from those of musicians’ and artists’ agencies. The former agent of Wayne Rooney, Proform Sports Management Limited, lost its claim of unlawful contract interference against the footballer’s new agents, Proactive Sports Management Limited, in a judgment published yesterday. Proform entered into an exclusive management and agency agreement with Rooney in 2000 (when he was 15 years old) for a term of two years. He did not take legal advice, though his father also signed the contract. The contract covered all “functions in respect of personal representation on behalf of his work as a professional football player” as well as all “contract negotiations and transfers”. Within two years, Rooney left Proform to join Proactive, who Proform claimed had induced Rooney to breach his contract by leaving. Proactive claimed that the contract did not cover “marketing and image rights” and more importantly, in any event, was voidable by Rooney for being a contract with a minor. The court accepted that a contract with a minor is not enforceable against him unless it is a contract for “necessaries” but it was unclear whether this…

Seal ordered to pay commission to ex-manager Wadlow v Samuel pka Seal (2006) By Julian Bentley, solicitor, Swan Turton
Artists , Contract , Restraint of Trade / August 2006
UK

CONTRACT Artists ARTICLE:  Multi-million selling solo artist Seal was managed by John Wadlow under a management agreement signed in 1990. In 1995 Seal wanted out. The two of them signed a settlement agreement that year terminating the management agreement and providing for continuing commission to be paid to Wadlow on Seal’s first two albums, “Seal” and “Seal II”. Seal stopped paying the commission in around 2001. Wadlow issued proceedings. Seal defended the claim alleging amongst other things undue influence and restraint of trade. The judge (Mr Justice Gray) found that Wadlow was entitled to his commission. Under the management agreement Wadlow received commission at the customary rate of 20%. But the agreement was, by today’s standards, unusual in two respects. Firstly, Wadlow’s entitlement to commission after the end of the term of the management agreement went on forever at the full rate. Almost always these days, there is a tapering or “sunset” provision reducing and then extinguishing the former manager’s post-term commission over a period of years. Secondly, Wadlow was entitled to commission on Seal’s income from a publishing deal signed in 1989 between Seal and a Wadlow co-owned company. So Wadlow was receiving management commission on Seal’s publishing income…

Bourne and others v Davis (trading as Brandon Davis Publishing)
UK

COPYRIGHT / PERFORMERS RIGHTS / CONTRACT Artists This case involves the successful pop musician James Bourne, most latterly of Son of Dork and previously with Bustedin a contest with a certain Brandon Davis who tried to release some early recordings featuring Bourne. Between December 2000 and October 2001 Bourne and three other musicians wrote and performed songs together. While developing songs and compositions they recorded a set of nine songs in a hotel room in London. Later, the four stopped performing together. Bourne then became involved in Busted, and concluded a recording contract with the second claimant. By that contract Bourne assigned all his rights, including his performer’s rights (section 180 of the Copyright, Designs and Patents Act 1988) for recordings made before the date of the contract. Busted then had a bust-up and stopped playing together and Bourne joined a new group, Son of Dork. At this juncture Bourne signed yet another contract, this time with the third claimant (an affiliate of the second claimant), which also took an assignment of his performer’s rights for performances occurring before the date of that contract. However Davis made a compact disk comprising an album of the nine tracks performed by the original group of four…

Seal must pay £1 million to ex-manager
UK

CONTRACT Artists Seal ( Henry Olusegun Adeola Samuel) has been ordered to pay his former manager about £1 million of the money made from his early hits in a High Court action. The singer songwriter had argued said that he did not owe a penny in commission to John Wadlow, the manager he once regarded as a father figure and who gave the singer studio time when he was a struggling unknown. However, at a hearing at the High Court yesterday, Mr Justice Gray ruled that Wadlow was entitled to payment under a settlement agreement signed by the two men in 1995. Mr Justice Gray held that this agreement, signed to terminate formally their working relationship, gave Wadlow the right to the unpaid commission. The settlement replaced earlier agreements and Wadlow agreed to termination and agreement which would have otherwise provided substantial future earnings as Seal’s manager. The effect of the settlement agreement was that Mr Wadlow has a continuing entitlement to commission in respect of Seals first and second albums Seal and Seal II, both of which reached number one in the UK album charts. The judge rejected s counterclaim argued by Seal that even if he did owe money to his former…

SonyBMG challenged over digital artist royalty rates
USA

CONTRACT Record labels, artists, internet Members of the Allman Brothers Band and Cheap Trick have filed a class action lawsuit alleging that Sony BMG has underpaid artists for digital music transactions. At issue in the action, filed April 27 in U.S. District Court in New York by Labaton Sucharow & Rudoff and Probstein & Weiner, is whether the label’s deal with online services for downloads is a license or a sale. Sony BMG labels consider that their deals with the services are for sales of records rather than licenses for the recordings. But the suit alleges that Sony BMG is violating contractual obligations to share 50% of the net licensing revenue from digital music transactions with artists. The two bands claim that from 99-cent downloads, they receive only about 4.5 cents, rather than the 30 cents per track they believe they are owed. For years, artists have complained that royalties are further cut; many contracts permit a 50% reduction in royalties for music sold through a new technology, as well as a packaging deduction. Many artists say these clauses only made sense in the physical world, when music migrated to CDs from cassettes. The suit concerns royalties received for master…

Marley bass player loses claim
Jamaica
UK
USA

COPYRIGHT / CONTRACT Record labels, artists Marley bass player loses claim : Aston Barrett v Universal-Island records and Others [2006] EWHC 1009 (Ch) Aston Barrett, the bass player for Bob Marley and the Wailers, has lost a £60 million ($113.6 million) lawsuit over royalties and songwriting credits against Island Records and the Marley family. Barrett testified that he and his brother Carlton Barrett, a drummer for the reggae band who was murdered in 1985, did not receive the money they were due following Marley’s death from cancer in 1981. But Mr. Justice Lewison dismissed the suit on May 15 in a ruling at London’s High Court. Barrett will be liable for court costs. The Barrett brothers played on numerous Marley albums, including “Natty Dread,” “Rastaman Vibration” and ” Babylon by Bus”. They joined the band after Peter Tosh and Bunny Livingstone left – the Barrets had already achieved major success with their own band The Upsetters. The law suit claimed royalties owed under a 1974 contract with Island Records together with Aston Barret’s claims for songwriting royalties on songs he co-wrote with Marley. Whilst the band originally shared equally it was alleged that a new agreement was made in 1976 whereby Marley would take 50% of record…

Apple Computers survive assault from The Beatle’s Apple Corps
Contract , Internet , Trade Mark / June 2006
UK

TRADE MARK / CONTRACT The internet, technology, all areas Apple Computers survive assault from The Beatle’s Apple Corps: Apple Corps Limited v Apple Computer, Inc. (2006) EWHC 996 (Ch) Apple Corps has lost its High Court action in the United Kingdom to prevent Apple Computers using the mark (name) Apple in connection with it’s iTunes online music store. Mr Justice Mann held that the ongoing use by the computer company has not broken a 1991 deal aimed at ensuring there would not be two ‘Apples’ in the music industry. The first agreement between the parties was in 1981 concerned the use and registration of the word “Apple” and various apple logos. Mann J said “I do not need to set out the detailed terms of that [1981] agreement. In general terms, Computer was allowed to use its marks in relation to computer goods and services, but not use them in relation to computer equipment specifically adapted for use in the recording or reproduction of music, or in relation to operational services relating to music. It was also prevented from using its marks in relation to apparatus specifically designed and intended for synthesising music unless certain restrictions were met. Corps could use its…

Apple vs Apple By By Nancy B. Adams, MacNewsWorld
USA

CONTRACT / TRADE MARK Internet, record labels ARTICLE LINK  A neat update on the current litigation over the Apple mark which is primarily centered on the agreement between Apple Computers and the Beatle’s Apple Corp in 1991 where the computer firm said it wouldn’t use the Apple mark in connection with the distribution of music …. “It’s an interesting contract interpretation question, since today’s understanding of what is content versus services seems not to have been the understanding at the time the language was agreed upon” http://www.macnewsworld.com/story/K8HE5jy5zmMirn/Logo-Lawsuit-Could-Get-Sticky-for-Apple.xhtml see also http://makeashorterlink.com/?U1892450D and see the article Apple SuesApple Again by Katherine McGinnis in E-Tips Volume 4 No 21 www.dww.com

Killers litigation with ex-manager anticipated
Artists , Contract / March 2006
USA

CONTRACT Artists The Killers’ former manager is suing the band for ‘breach of contract’. Braden Merrick says his contract with the band was to run through 2007, but he was sacked last May. He is seeking $16M in settlement according to FiveEight magazine. http://www.usatoday.com/life/people/2006-02-22-killers-lawsuit_x.htm?POE=LIFISVA http://news.bbc.co.uk/1/hi/entertainment/4742334.stm

Korn launch new band-label-promoter relationship
Artists , Contract , Record Labels / February 2006
USA

CONTRACT Record labels, artists Korn are launching a new financial model for touring on their new US tour as a financial experiment with promoters.  Live Nation Inc (the newly spun-off arm live promoting arm from Clear Channel) who will be the band’s exclusive US promoters. Live Nation will get a 6% share of their box office, licensing, publishing, merchandise and CD revenue for their current and next album according to the New York Times. The promoter is treating this as a long-term investment. Live Nation will pay the band’s production expenses and the band will also get a share (in certain circumstances) of ancillary sources such as drinks and food sold at concerts. Last September, the band signed a five-year deal with EMI whereby the label gets a share of the band’s earnings beyond recorded music. It was suggested at the time that EMI paid a $15M advance for a 25% share in all areas of the band’s earnings. This new deal with Live Nation will see all the live-related monies flow into one pot and then profits distributed three ways – to the band, the promoter and the label. http://www.nytimes.com/2006/01/11/arts/music/11band.html

Status Quo face past royalty claim from departed band members
Artists , Contract / January 2006
UK

CONTRACT Artists After narrowly avoiding litigation with ‘mad fan’ Les Battersby whilst making guest star appearances in UK soap Coronation Street recently, Status Quo members Rick Parfitt and Francis Rossi faced court room reality when Chancellor Sir Andrew Morritt ruled that founding members, Alan Lancaster and John Coghlan had realistic prospects of success in several claims for past royalties. Parfitt and Rossi continue trading as Status Quo with replacement musician. The case continues and the trial will be heard at a later date.  Simon Jacobs, Partner at Seddons said “It is most unusual for claims such as these to be successful which is why we are so pleased with the result”. Indeed the 1994 case involving Cure co-founder and drummer Laurence (Lol) Tolhurst is a good example of a claim for royalties from a departed band member. Tolhurst was asked to leave the band in 1989 and sued Robert Smith, the lead singer and the bands record label over the division of royalties from a recording agreement in1986. Tolhurst claimed he only had the ‘crumbs’ of the income from the recording agreement and that Smith had the lion’s share and was looking for 50% of all profits receivable under the…

Apple Corp instigates proceedings against EMI for unpaid royalties
Artists , Contract , Record Labels / January 2006
UK

CONTRACT Record labels, artists The Beatles’ Apple Corps has issued proceedings against EMI for more than £30 million ($52.9 million) in a row over unpaid/underpaid record royalties dating back to 1962. London-based Apple Corps Ltd. launched the proceedings in the High Court on December 15 th in London and New York’s Supreme Court against EMI Records and Capitol Records, respectively. In a statement from Apple Corps, the label says it took action following a breakdown in negotiations with EMI over the disputed royalties. The case arises from an audit of accounts where Apple claims to have discovered irregularities. EMI has responded saying that it welcomes “full financial transparency” and that such audit requests are common. EMI offered to go to mediation, but Apple rejected this. EMI and Apple were previously in court in 1991 over the planned re-release of the ‘Red’ and ‘Blue’ albums on CD. Apple Corps is currently in a legal dispute with Apple Computers over the ‘Apple’ trademark and its association with music in light of the launch of the iPod and iTunes Music Store (see the November Law Updates). http://news.bbc.co.uk/1/hi/entertainment/4535330.stm http://www.billboard.com/bbcom/news/article_display.jsp?vnu_content_id=1001699776 http://www.guardian.co.uk/arts/news/story/0,,1669545,00.html

Abusive contract terms struck down by French court in AOL Standard Form Contract
Contract , Internet / November 2005
France

CONTRACT Internet, general In a judgment released September 15, a three-judge panel of the Versailles Court of Appeal has unanimously dismissed an appeal by SNC AOL France (AOL) from a lower court decision handed down in 2004 in favour of a French consumer protection body, Union Fédérale des Consommateurs “Que Choisir” (UFC), relating to AOL’s online subscriber contract in France (AOL Contract). In the case, UFC v AOL France, many different clauses in the standard form contract were at issue, including such fundamental provisions, for example, as those relating to AOL disclaimers of liability (including liability for content information originating from third parties and liability for failure to provide the online service contracted for) and AOL’s rights of termination (including the right of AOL to terminate the contract unilaterally). Several of the clauses in the AOL Contract were found to be abusive and unenforceable because they were contrary to French local law or, in some cases, contrary to EU-wide laws such as the Unfair Terms in Consumer Contract Directive of 1993. Under the latter legislation, courts have the power to decline to enforce provisions in consumer contracts that are seen to demonstrate a “significant imbalance” of bargaining power between the parties. For…

Korn sign all in deal with EMI
Contract , Record Labels / October 2005
USA

CONTRACTS Record Labels Following the much discussed deal between Robbie Williams and EMI, The LA Times reports that EMI has signed a five-year deal with Korn where the label will have a stake in the band’s additional earnings beyond sales of recorded music. An estimated fifteen million dollar advance has been paid. Similar deals are being done with new acts including A&M/Interscope’s deal with the Pussycat Dolls. My Chemical Romance’s deal with Warners covers both recording rights and merchandise. Under Korn’s new deal, EMI will get more than 25% of the band’s publishing, merchandising and touring revenue as well as profit from the group’s albums The signing of a band as big as Korn is seen as possibly indicative of how recording contracts will change across the industry. Some see this as a way for labels to get a better/quicker return on their investment (as bands will be marketed more aggressively through all media channels). However, others are suggesting that Korn’s recording and touring fortunes are on the slide, making this a curious time to sign a deal such as this with the band. Music executives and artists say that if all-encompassing agreements become common, they could significantly shift the…

Ashanti producer wins $630,000 in royalty claim
Artists , Contract / September 2005
USA

CONTRACTS Artists A US judge has ruled that that Ashanti owes $630,000 to her first producer for breach of contract. The singer was not in court when the jury returned its verdict in favor of Genard Parker, who worked with Ashanti in 1996 and 1997 when she was 16. Ashanti testified during the four-day trial that Parker did not live up to the terms of their deal as he helped her create music in a home studio that was so crude she sang in the bathroom. Parker claimed that he was due a royalty on Ashanti’s album after Ashanti’s mother approached him in 1996 and he produced tracks for Ashanti in anticipation of future compensation. Parker and his team claims that Ashanti and her mother broke the contract and owed them “certain benefits and fees” to the tune of $4 million. Parker argued that Ashanti eventually signed with a record company and that he released her from his contract with the understanding that he could produce two songs on her first album. Ashanti, now 24, has sold more than 6 million copies of two albums, including “Ashanti,” her debut, which garnered a Grammy Award in 2003 for best contemporary R&B…

Waits challenges download royalties based on physical product sales
USA

CONTRACTS AND COPYRIGHT Music Publishers, Internet, Record Labels Third Story Music, a Los Angeles-based music publishing firm and the successor to the production company that managed singer-songwriter Tom Waits early in his career, has filed a federal suit against Warner Music Group, alleging that Waits has been shortchanged on the sale of digital downloads. The action, filed in U.S. District Court for the Central District of California in Los Angeles stems from 1972 and 1977 contracts signed by Third Story principal Herb Cohen and Warner-owned Asylum Records regarding Waits’ services. According to the suit, under the terms of the two contracts, Waits was entitled to royalties of either 25% or 50% from revenues derived from third-party licenses. Third Story maintains that digital music downloads constitute a form of third-party license, and that Waits is entitled to payment at that level. Wait’s 2003 and 2004 royalty statements to Third Story from WMG computed royalties from Waits’ digital download sales at the same (and much lower) rate as royalties from the sale of physical product. – on those calculations Waits would be entitled to either 9% or 13% of the 67 cents received by WMG from each 99-cent download. Third Story seeks…

Linkin Park seek to exit Warners deal
Artists , Contract , Record Labels / June 2005
USA

CONTRACT Artists, Record Labels Just as Warner Music geared up for its $2.6 billion IPO (flotation), one of its biggest acts has said that it would like to get out of its contract with the label. Nu-metal genre leaders Linkin Park allege that cost-cutting across the company has diminished its strength, leaving it “unable to compete in today’s global music marketplace” and that senior executives are taking profit at the expense of musicians. The band has threatened to stop work on its new album, believing the company will not be able to market it sufficiently. The band has sold over 35M albums globally and says that it makes up 10% of the company’s US sales. Warner Music has stated that it is closer to 3%. The band still has a further four albums to deliver under its current contract and Warner Music has dismissed this outburst as a “negotiating tactic” built on “baseless charges”. It has been suggested that the band had asked for $60M in advances to release their new album through a JV deal in exchange for a split of profits. Warner Music is said to have offered substantially less and a profit split. The band is said…

Nine Inch Nails’ Reznor sues ex-manager
Artists , Contract / June 2005
USA

CONTRACT Artists Trent Reznor has now testified against his longtime manager, saying he was stunned to learn in 2003 that despite millions of dollars in earnings by his band, Nine Inch Nails, he was left with as little as $400,000 in cash and $3 million in assets. The New York federal civil lawsuit is against John Malm. Reznor contends that his former friend duped him into signing a contract that allowed Malm to collect 20 percent of the singer’s gross earnings rather than net earnings. A lawyer for Malm, said in an opening statement that his client worked many years for no salary and kept nothing secret from Reznor. Reznor said that pair created their own production company and managed sales of merchandise but the expenses piled up, draining large portions of the millions of dollars the band earned with its albums and concert tours. Reznor said he began to grow worried about finances when he was told during a meeting with Malm in 2002 that there was “cause for alarm.” See: http://www.billboard.com

Nugent claim limited to concert fee and direct loss
Artists , Contract , Live Events / May 2005
USA

CONTRACT Artists, Live Music Industry Ted Nugent has had his claim against the Musekegon Summer Festival limited to the alleged concert fee and direct loss of profit from merchandise after a cancelled show in June 2003. Muskegon Country Circuit Judge Timothy G Hicks refused to allow claims of more than $1 million for future lost income. If Nugent wins his suit, the most that the 56-year-old musician would be eligible to receive is $80,000 plus an estimate of lost merchandising income. Nugent sued the festival in August 2003. He claims his reputation and career were damaged by the cancellation of his June 2003 show and a subsequent news release from the festival that, he says, wrongly accused him of making racist remarks during a live interview on Denver radio station KRFX-FM in May 2003. Nugent’s denies making such remarks. His longtime personal manager, Doug Banker testified this week that he negotiated with festival officials for an $80,000 performance fee for Nugent but there was no signed agreement. Banker said oral agreements were the norm in the concert business. See: http://www.detnews.com/2005/metro/0503/27/metro-129413.htm andhttp://www.myplainview.com/APTexas/parsed/stories/D89285MO0.shtml

Patti LaBelle brings claim for non-payment of appearance fees
Contract , Live Events / April 2005
USA

CONTRACT Live Event Industry Patti Labelle (nee Patricia Edwards) has brought an action through her management company, Pattonium Inc, against an American promoter Kensey Wright and Fifth Degree Entertainment after she was promised $150,000 to perform at the annual football classic between N.C. Central University and N.C. A&T University during the summer of 2003. She alleges that she was told that a portion of the money from the concert would go to scholarships. She also says she was led to believe that travel and hotel expenses for herself, her band and her stage crew would be covered. The suit is for breach of contract, unjust enrichment and fraud and filed in Chesapeake Circuit Court. Wright, through his attorney, Bernard T. Holmes, denies the allegations. Holmes described the event as a charitable concert that lost money but is quoted as saying “Putting on any concert is an undertaking,” he said. “Anything can go wrong at any time.” According to the lawsuit, Labelle arrived at the RBC Center in Raleigh on August 29th 2003, and performed, even after she realized she would not be paid in full, according to the lawsuit to entertain fans. LaBelle was to be paid $75,000 before the…

Jury orders booking agent and artist lawyer to pay damages of $1.6 million
Contract , Live Events / January 2005
USA

CONTRACT Live Music Industry In an unusual decision a US jury has awarded a damages of US$1.6 million to promoters of a cancelled Rod Stewart tour and ordered the return of a $780,000 deposit held by Mr Stewart as compensation. The Los Angeles jury found in favour of concert promoters in Peru, Argentina (including the Vina del Mar Festival) and for Oklahoma based promoters PM Group. The damages order was made against Rod Stewart’s lawyer and his then booking agency, ICM. The dispute related to a 9 date tour of South America planned for February 2002. The deposit was against a total $2.1 million fee which was cancelled in February. The tour was cancelled after disputes regarding the contract which the claimants have said contained new terms and was negotiated by Mr Stewart’s lawyers rather than ICM. New provisions included new costs for the promoters including the provision of hotels, airfares and frieght costs. However it was ICM who held the tour deposit and cancelled the dates when the balance of the outstanding tour fee and executed contract were not forthcoming. The decision will be appealed. Source : Audience Magazine, December 2004, Issue 58

Rolling Stones must arbitrate royalty dispute with Decca
UK

CONTRACT Record Labels, Music Publishing, Artists Mr Justice Pumfrey has held that the Rolling Stones must settle their royalty dispute with Decca by way or arbitration. The band had been seeking to audit Decca’s books to force the label to pay out millions of pounds allegedly owed to the band. However the High Court hearing resulted in a ruling that under the terms of an agreement between the label and Mick Jagger, Keith Richards and Charlie Watts, disputes over royalty payments must be referred to arbitration rather than being dealt with by the court. The dispute arose out of royalties from the best selling compilation 40 Licks. The band were given leave to appeal. SourceThe Times 13 November 2004 and see : http://www.billboard.com/bb/daily/article_display.jsp?vnu_content_id=1000718886

Distribution Agreements
Contract , Record Labels / June 2004
UK

CONTRACT LAW Record Labels ARTICLE: by Sarah Waddington The problems surrounding 3MV’s insolvency have brought to a head the sometimes thorny issue of ownership of stock. These problems should prompt every independent label to look at their own distribution agreement. A number of independent record companies distributed by 3MV may rue the day they did not pay more attention to the clause in their distribution agreement which governs when ownership of stock – records – passes from them to the distributor. Ownership of stock is one of the provisions in standard distribution agreements which need to be reviewed very carefully. The Sale of Goods Act 1979 allows contracting parties to agree the time at which ownership of goods will pass. In the absence of an express provision, ownership of goods passes when they are delivered. A number of 3MV’s distribution contracts expressly provide for ownership of records to pass on their delivery to 3MV and, in some circumstances, on manufacture. From that date those records are assets of 3MV. This is not in a record company’s interest – ownership of these records should be retained by the record company until payment for them is received. If ownership of records is…

Rapper Ras Kass Launches Action Against Priority Records, Capitol and EMI
USA

CONTRACT Record Labels, Artists, Music Publishers Rapper Ras Kass (real name John Austin) has filed suit against Priority Records, Capitol Records, EMI Music and two Priority executives, claiming breach of contract, unfair competition, restraint of trade and other abuses. The suit, filed in California Superior Court in Los Angeles, seeks a rescission of the musician’s contract, and compensatory and punitive damages to be determined. According to the suit, in 1995, Austin, who was then a 22-year-old Patchwerk Records artist, signed a contract with Priority requiring delivery of one album, with an option for five more albums. The action claims that Priority failed to market and promote the albums “Soul on Ice” (1996) and “Rassassination” (1998). It also alleges that two Priority executives maliciously interfered with Austin’s career. The suit further alleges that the releases of Austin’s third and fourth albums were sabotaged, and that Priority interfered with a proposed group project for Sony that would have featured Austin, Xzibit and Saafir. According to the suit, owing to “fraudulent accounting practices,” Austin has received only $100,000 during the nine years of his contractual agreement, an average of approximately $11,000 per year. The 32-page filing broadly excoriates standard record-industry practices, and calls…

Maverick Records Launches Legal Action Against Warner Music
Artists , Contract , Record Labels / April 2004
USA

CONTRACT LAW Record Labels, Artists Madonna’s Maverick Records label has filed a legal action against Warner Music Group and Time Warner Inc. for breach of contract accusing the record company and its former parent of mismanagement and improper accounting that cost the singer and her partners millions of dollars. The lawsuit, filed in Los Angeles Superior Court, is the latest chapter in a long-running dispute between Madonna and Warner over Maverick, a joint venture the singer and record company launched in 1992. In the suit, Beverly Hills, California based Maverick accuses Warner Music and the other defendants of “engaging in acts of self-dealing and profit-taking, falsely accounting for receipts and expenses of the partnership … and secretly attempting to seize partnership opportunities for their own benefit.” Maverick claims Warner violated the venture agreement by failing to pay for “guaranteed” services like radio promotion, marketing and sales meant to support Maverick artists. The suit also contends Warner obscured label profits by using “artificial and improper accounting methodology to create the false impression of losses.” Madonna and her partners own a combined 60 percent stake in Maverick, whose artist roster includes Alanis Morissette and Michelle Branch. Warner owns the remaining 40 percent…

British Comedian Faces Damages Claim For Show Cancellation
Artists , Contract , Live Events / December 2003
UK

CONTRACTS Artists, Live Concert Industry The British comedian Jim Davidson faces a claim of £35,000 after he cancelled a show at Plymouth Pavilions. The comedian backed out of the show after audience members in wheelchairs refused to move from the front row of the theatre before the show began. The venue refunded 1,700 audience members with the cost of their tickets (£17.50 and £19.50) and the cost of programmes bought. However, Mr Davidson justified his actions because his show involves him ‘taking the micky’ out of the front row of any show and in the circumstances he did not want to appear to be insulting the front row which was wholly made up of disabled patrons. It appears that Mr Davidson did not want to compromise his show or be seen to insult disabled patrons. Source: The Times 22 October 2003

Van Morrison Ordered To Pay Damages For Cancelled Contract
Artists , Contract , Live Events / December 2003
UK

CONTRACTS Artists, Live Concert Industry English pub landlord Gary Marlow has been awarded approximately £40,000 in damages after Van Morrison cancelled a concert at the Crown Hotel public House in 2002. The singer, and his production company Exile, claimed that the contract had been breached by Marlow publicly advertising the event – but the court thought otherwise. The damages included the return of a £20,000 deposit. However, the damages fell far short of what Mr Marlow had asked for – he claimed the failed concert severely damaged the business of his pub and wanted damages of £400,000 for the long term damages to his business. This was not accepted in the High Court and Mr Marlow faces a substantial legal bill – it is also thought he may have turned down an offer of more than £40,000 from the singer to pursue the claim. A review of the judgement by Richard Taylor and Emma Stoker can be seen at:http://www.simkins.com/ebulletins/archive/default.aspx and see: http://www.ilmc.com

Judgement For Damages In Holly Valance Management Dispute
Artists , Contract / December 2003
Australia

CONTRACTS Artists Holly Valance’s Australian ex-manager, Scott Michaelson, has been awarded AU$350,000 (approx £160,000) in damages after the singer wrongly terminated his management contract. Justice Clifford Einstein found that the artist had breached the contract and awarded the damages for loss of earnings and management commission. Ms Valance will also have to pay costs. Mr Michaelson’s damages were limited to Holly Valance’s first album and he will not receive commissions from her yet to be released second album. See: http://www.theage.com.au/articles/2003/11/06/1068013328625.html

Ex-manager wins case against Holly Valance
Artists , Contract / November 2003
Australia

CONTRACTS Artists Holly Valance’s ex-manager, sacked by the star when her pop career began to take off, has won his action against the star in an Australian court. The Court held that Vallance had unfairly terminated the contract of Scott Michaelson in January 2002. Lawyers for Valance claimed Michaelson – like Valance, a former Neighbours actor – had been ill-equipped to manage the star’s burgeoning music career. Michaelson is seeking £160,000 in lost income, a 20% cut of sales of Valance’s second album and exemplary damages. The Court will now assess damages. Valance first found fame in Neighbours. She released her first album, Footprints, in October last year. See: http://news.bbc.co.uk/1/hi/entertainment/showbiz/3161392.stm

Limp Bizkit sued by irate fans
Artists , Contract / November 2003
USA

CONTRACTS Artists Limp Bizkit are being sued by 172 rock fans who attended July’s infamous Chicago show, which ended after only 17 minutes when the band were booed off stage. A lawsuit was submitted yesterday to District Court in Illinois. The band were supporting Metallica on the Summer Sanitarium tour, at Chigaco’s Hawthorne Racetrack. The suit alleges that the plaintiffs were expecting a ninety minute show but the band’s front man, Fred Durst, fired-off a tirade against the city and the audience, before challenging the entire crowd to a fight. The breach-of-contract suit has been filed by Michael Young, the lawyer acting on behalf of the 172 aggrieved concertgoers, who are seeking a $25 refund from the July 26 show opening the door to up to 40,000 re-payment claims. See: www.dotmusic.com

DEAL MEMOS AND CONTRACTS: PRETTY PICTURES v QUIXOTE FILMS (2003)
France

CONTRACT LAW Record Labels, Music Publishers, Television, Radio, Artists, Internet With the quick-fire thrust and parry of email becoming increasingly popular as a means of communication, the possibility of inadvertently creating a binding contract is an ever present danger. However, a recent case which came before the High Court has reinforced the basic legal principle that if the parties only intend to be bound by signature of a formal legal document, then an affirmation of the principal terms of the proposed agreement in email correspondence will not suffice for that purpose. In Pretty Pictures v Quixote Films the question came before the court as a preliminary issue. The claimant, a French film distributor, alleged that a binding contract had been concluded with the defendant, the owner of a film called ‘Lost in La Mancha’. Over a period of two or three months the claimant and the defendant’s sales agent had corresponded by email culminating in an email from the claimant setting out his ‘revised offer’. This, in effect, was a bald statement of the principal terms: minimum guarantee, term, territory, rights granted and income splits. There followed further negotiations but ultimately an accord was reached and the defendant’s sales agent sent an…

DEAL MEMO IS NOT A CONTRACT BUT INVOICE CAN BE. RAP IS A ‘FOREIGN’ LANGUAGE
UK

CONTRACT LAW Record Labels, Music Publishers, Artists Confetti Records & Others -v- Warner Music UK Ltd This UK case involved the purported licence of a sample of the track Burnin by the claimants to the defendants. The first claimant (Confetti) had been negotiating with the defendants about use of the track and had issued a ‘subject to contract’ deal memorandum which both parties signed. The first claimant then issued an invoice to the defendant and sent a recording of the track. Mr Justice Lewison held that ‘subject to contract’ had the same meaning in the music industry as other businesses and the document was not binding as such. It was for the defendant to prove otherwise. As the defendant had failed to do this, the deal memorandum was not binding. But Mr Justice Lewison went on to decide that the subsequent sending of an invoice with the track constituted an offer which was subsequently accepted by the defendant’s conduct in making use of the track and hence a contract had come into existence so there could be no copyright infringement as permission to use was granted. The third claimant, Andrew Alcee, brought a claim under Section 80 of the Copyright Designs and Patents…

FORMER MANAGER SUES DRU HILL
Artists , Contract / April 2003
USA

CONTRACTS Management, Artists The R&B group Dru Hill have been served with a $30 million lawsuit from former manager, Kevin A. Peck, who claims the group owes him millions of dollars in management fees. The lawsuit, filed in Baltimore Circuit Court on March 20 2003, alleges unjust enrichment and is served against all of the original band members. Peck believes that his management contract entitled him to a percentage of the group’s income from all three of its albums, as well as the members’ solo releases. Dru Hill attempted to settle with Peck, but were unable to reach an agreement with him. Dru Hill achieved multiple platinum albums, several music awards and generated millions of dollars in publishing royalties and record sales, including ‘The Thong Song’ released by band member Sisqo in late 1999. See www.news8.com Meanwhile, former Guns N’ Roses songwriter and guitarist, Izzy Stradlin, has also filed a lawsuit in the Los Angeles Superior Court. He alleges that he mistakenly paid his management firm Big FD $231,575 in post-term commissions after the ‘old’ Guns N’ Roses broke up and that Big FD had no right to receive this, since according to the agreement he entered, the remainder of his…