EMI Publishing faces another lawsuit on foreign royalties from ‘Daydream Believer’ songwriter whilst War declare, well, war.

November 2014

Music Publishing


Last month we commented on the how the estate of Duke Ellington is hoping to resurrect a royalties lawsuit against EMI Music Publishing, (now controlled by Sony/ATV)  after a lower courts sided with the music company in the legal dispute – seeking to establish that EMI had artificially reduced the royalties received by the entity Ellington had signed to as a songwriter by using its own subsidiaries to siphon off royalties. That claim has now failed again after an appellate court held that the copyright renewal that Duke Ellington signed in 1961 does not unfairly deprive his heirs of a portion of foreign royalties on works such as “Mood Indigo” and “Sophisticated Lady“. In Ellington v EMI Music, The New York State Court of Appeals ruled 5-2 that while changes in the music industry over the past 53 years have tended to make the contract and others signed in that era by artists like Ellington more favourable to music publishers, “clear and unambiguous” provisions govern EMI’s obligations to Ellington’s grandson Paul Ellington and the composer’s other survivors. Judge Sheila Abdus-Salaam, writing for the majority, said a plain reading of the contract says Ellington or his heirs are entitled to 50 percent of the net revenues received from foreign subpublishers of the composer’s works. The agreement was originally signed by Ellington and Mills Music, Inc., which is now part of EMI Music The fact that EMI has come to use affiliated foreign subpublishers in an arrangement that allows the publisher to reduce the amount of royalties that must be turned over to the Ellington family on foreign sales, is not a development contemplated in 1961, nor does it directly violate any terms of that 1961 contract.

“EMI’s corporate reconfiguration did not … avoid the understanding of the parties'” Abdus-Salaam wrote. “Rather, the parties merely did not account for the possibility that the publisher would eventually affiliate with foreign subpublishers.” Nothing in the contract signed by Ellington on Dec. 19, 1961, precluded EMI from making arrangements with affiliated foreign subpublishers which have, over time, worked out to the disadvantage of the Ellington heirs, Abdus-Salaam said.

“The parties did not include any forward-looking language,” she wrote. “If the parties intended to bind future allifiates, they would have included language expressing that intent.” Dissenting, Judge Jenny Rivera said in it was right to consider if that EMI has “manipulated” the net receipt provision in the 1961 contract to exclude foreign affiliate revenues.”The agreement lends itself to more than one interpretation concerning the net revenue sharing provision, and appellant’s interpretation seems reasonable, or at least as reasonable as the one proposed by EMI,” Rivera wrote. She was joined in the dissent by Chief Judge Jonathan Lippman

In another matter, the Sony/ATV-controlled EMI Music Publishing is now facing a lawsuit on the issue of fees taken by the music publishing major’s foreign subsidiaries in a lawsuit from the widow of songwriter John Stewart, a one-time member of folk-pop outfit the Kingston Trio, who wrote the Monkees’ hit ‘Daydream Believer’. Stewart signed a publishing deal with Screen Gems-Columbia Music in 1967, which was subsequently acquired by EMI. Stewart’s widow claims that under that deal, her late husband was due 50% of royalties generated outside the US, after any fees were taken by regional sub-publishers. But ‘Daydream Believer’ is, in the main, represented outside North America by other EMI Publishing subsidiaries, which then take 50% of the money before handing the rest over to the firm’s US division, which pays 50% to Stewart. However, says the lawsuit, where a regional rep is another branch of EMI there should be no additional fees taken. An estimated $450,000 in lost royalties is being claimed.

And members of the 1970s band War claim Far Out Music owes them more than $300,000 in royalties – that’s according to a lawsuit in Los Angeles Superior Court. Original band members Harold Brown, Lee Oskar Levitin, Howard Scott, as well as representatives for “BB” Dickerson and Charles Miller have issued proceedings.  The band members say the defendant record labels applied the wrong formula in calculating royalties under a settlement agreement and changed the revenue base to calculate the payments owed. The defendants are Gerald Goldstein, Far Out Music, Far Out Productions, Far Out Management, Jerry Goldstein Music, TMC Music, Audio Visual Entertainment doing business as Avenue Records, and Far Out Holding Corporation. The claim results from a  2010, settlement over a dispute involving various written agreements from the 1970s for their composing and recording services. The band says the defendants “have substantially underreported and underpaid” by at least $300,000 because the publisher’s share of money from public performances is included in the revenue base of the payments required by a 1972 agreement.




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