CONTRACT: A Court in New York has ruled that the Woodstock Festival’s financial backers had no right to cancel the event without the agreement of the organisers of the Woodstock 50, although the court declined to force Dentsu to return $18 million to the Event’s bank account.
The 50th anniversary celebration of the original Woodstock which is planned August, was thrown into doubt last month when Amplifi Live, a division of the Dentsu Aegis Network – announced that the event had been cancelled. The Woodstock company rebutted this saying at the time Amplifi had no right to make such a decision and took the matter to th courts for resolution.
In what seems to be an analysis of the contract between the two former partners, and in particular what that contract said about cancelling the event and the management of the bank account that had been set up to pay festival costs. CMU Daily reports that “The agreement did set out quite clearly what Dentsu could do if it thought the Woodstock company was ever in breach of its contract. Basically, the marketing firm could either cancel the deal and walk away from the project, or take control of the festival and more directly manage the booking of acts and delivery of the event.” And indeed Dentsu did think breaches had occurred over a lack of consultation of talent bookings, a change to the capacity and budget disputes. This meant Dentsu could take control of the event. But, and it’s a big but, the court ruled that this control did not extend to cancelling the event and the two parties’ agreement was still in place and that clearly provides that “any decision to cancel the festival shall be jointly made in writing by the parties”.
The court ruled that Dentsu and its subsidiaries “are enjoined and restrained … from cancelling the festival or communicating to the media and/or festival stakeholders – including state and county officials, venue operators, local vendors, community representatives, insurers, producers, and talent agencies, and performers – that the festival has been cancelled”.
What the court didn’t do was ask Dentsu to return funds to the Event bank account, which was under Dentsu’s control. There was just under $18 million in that account at the point the marketing group withdrew – and on withdrawal Dentsu removed those funds. The court did not order the return of those funds saying that request was denied “pending a full evidentiary hearing, for a mandatory injunction directing [Dentsu] to return the $17.8 million to the festival bank account and provide [Woodstock] access to the funds in the festival bank account” and Judge Ostrager said that the Woodstock company had fallen “woefully short of making the heightened showing necessary to warrant a mandatory injunction ordering [the return of] $17.8 million to the festival bank account”.
Putting a good spin on the result, a spokesperson for Dentsu told Billboard that they feel “vindicated to hear that the court agreed with what we have maintained all along: Woodstock 50 was not entitled to access the festival bank account per the contract and thus any access now is denied and the $17.8M remains with Amplify Live”‘ and “The court did not rule that Amplifi Live’s assumption of control over the festival was improper or alter that status in any way” and added “While we understand that pursuant to the court’s ruling Amplifi Live cannot cancel the festival without Woodstock 50’s agreement, at this time we do not intend to further invest in the festival due to the issues noted by the court, as well as the compressed timeframe, and multiple health and safety concerns.”
With the Woodstock company saying “Woodstock 50 is on!” it seems organisers will need to find a new financial backer to cover the budget, and further legal action between the two former partners may follow although variety reports that the court confirmed that this will ultimately be settled in arbitration — which will take place long after Woodstock 50 does or does not happen.
UPDATE: JULY 23RD: the Festival had lost it’s production partner and had been repeatedly refused a licence: Vernon Downs, a casino and horse racing complex also in the state of New York, was the first choice new home for the big 50th anniversary show. There no camping facilities available and Vernon Town attorney Vincent Rossi says that when the Woodstock team did submit their application for a licence (which was already late in the day) the submission was “inadequate” and “Each application submitted, one for each of the three days, was one page long with no supporting materials”. Following the fourth refusal a letter from the Town Council provided a long list of problems with the latest proposal submitted by organisers of the event, including that the safety plan they presented is basically “worthless”. Perhaps most importantly of all, organisers still had not addressed the biggest concern for Vernon officials, which is how 65,000 festival-goers will get to the site, and what they will do at the end of each day, given Vernon Downs isn’t able to accommodate any camping.