Last week we briefly covered the streaming royalty and internet radio debacle, but the trouble escalated Thursday when American Idol’s 19 Recordings group filed a lawsuit against Sony Music.
The claim is that, “Sony Music has been systematically robbing [19 Recordings artists] of millions of dollars in royalties.”
Although, while most of the $10 million sought in damages relates to streaming royalties (always at the heart of any issue lately), 19’s complaint “also alleges that Sony has made other improper deductions over things like music videos, has incorrectly paid royalties on joint venture compilation albums, has improperly calculated escalated royalty rates...is failing to pay over money from past lawsuits, is improperly deducting foreign income taxes,” and, most pertinently, “is underreporting or not reporting at all synchronization master uses in films and TV shows.”
So how are Sony and Idol connected? As The Hollywood Reporter points out, “19 Recordings was founded by American Idol creator Simon Fuller and is now controlled by the show’s owner, Core Media Group.” 19, according to Idol contracts, has the exclusive right to sign the show’s contestants.
However, despite the show’s recent partnership with Jimmy Iovine and Interscope Geffen A&M (UMG), recordings produced before that relationship were and still are distributed by RCA Music Group, a Sony Music property.
THR’s article fleshes out all the details of the impending litigation highlighting examples of Sony’s creative accounting, and you can read the whole story here to brush up on the facts as the lawsuit develops!