Rapper's suit is the latest action filed over digital royalties
Public Enemy frontman Chuck D has joined the chorus of Universal Music Group artists who have sued the company for underpayment of digital royalties.
In a related matter, a federal judge has denied UMG’s motion to dismiss the earlier actions filed by Rob Zombie and Rick James’ estate.
Chuck D (real name Carlton Douglas Ridenhour) filed his own class action suit against UMG in U.S. District Court in Northern California on Wednesday. The action alleges “UMG’s accounting practices … have allowed UMG to illegally withhold a substantial amount of money it receives from digital content providers” for the sale of digital downloads and master ringtones.
According to the action, UMG acquired rights to Public Enemy’s 1987-98 recordings when it acquired Def Jam, the rap act’s label, in 1998.
Suit claims “UMG is paying plaintiff and other class members roughly 25% of the royalties that it should be paying them for moneys received from music download providers.”
Chuck D’s action cites last year’s appellate court decision in F.B.T. Prods.’ suit against UMG and Aftermath Records, which found that F.B.T., which produced Eminem’s earliest recordings, was entitled to higher digital royalties based on rates for masters licensed to third parties ( Variety , Sept. 7, 2010).
That decision also inspired class actions filed in federal court earlier this year by the James estate ( Variety , April 5) and Zombie, his band White Zombie, Whitesnake and Dave Mason ( Variety , May 24).
On Monday, U.S. District Court Judge Susan Illston denied UMG’s motion to dismiss the case based on a reading of Zombie’s and James’ contracts specifying the proper venue for legal action.
Chuck D’s action now brings the number of pending royalties cases against UMG to three. James Pizzirusso, an attorney at Hausfeld LLP in Washington, D.C., which is representing the rapper, told Variety , “I can see the cases will eventually be consolidated.”
A spokesperson for UMG said that Chuck D’s suit “suffers from serious flaws and weaknesses,” and that the company would “vigorously defend against it.”
As for the denial of its motion to dismiss, UMG said: “The court has simply stated that the motion, which addressed a small part of the case, is more appropriately decided at the summary judgment stage rather than at the motion to dismiss stage. We believe that once the court addresses the merits of this case, we will prevail.”