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James Taylor sues WB over royalties

Singer seeks at least $2 mil from digital licenses

Singer-songwriter James Taylor has slapped a wide-ranging suit on his former label Warner Bros. Records, with under-payment of digital royalties among the claims.

Taylor’s action, filed Sept. 13 in Superior Court in L.A., seeks at least $2 million in compensatory damages, plus interest and a declaration that the musician is contractually entitled to 50% of net receipts for digital downloads and ringtones.

Taylor joins a growing number of artists — including Kenny Rogers, Peter Frampton, Michael McDonald and “Weird Al” Yankovic – who have lodged individual suits against their labels, alleging shortchanging on digital royalties.

After making his solo debut in 1968 on the Beatles’ Apple label, Taylor was signed, via his production company, to a distribution deal with Warner Bros in October 1969. The agreement was amended in January 1972 and awarded Taylor 50% of net receipts for licensed masters.

Taylor and Warner Bros. terminated their agreements in October 1979. By that time, he had recorded three top-five albums for the label, including “Sweet Baby James” (No. 3, 1970) and “Mud Slide Slim and the Blue Horizon” (No. 2, 1971), and cut the hits “Fire and Rain” (No. 3, 1970) and “You’ve Got a Friend” (No. 1, 1971).

Under his 1979 termination agreement, Taylor conducted a pair of audits of Warner Bros.’ books for the periods covering Jan. 1, 2004-June 30, 2007 and July 1, 2007-June 30, 2010.

Like a similar suit filed earlier this year against Sony Music Entertainment by Yankovic’s production company, Taylor’s action claims many accounting shortfalls, but focuses on monies owed for digital royalties.

Taylor’s suit claims that the lower royalty rates Warner paid for digital downloads and ringtones are “applicable only to phonograph records…and are not applicable to the licensing of the masters.” It also notes that the lower payments are “wholly inconsistent with the historical practice…and the conduct of Warner Bros. before this dispute arose.”

As in more than a dozen class action and individual suits filed against the major labels since early last year, Taylor’s suit cites the 2010 appellate court decision in F.B.T. Productions’ suit against Aftermath Records – the so-called “Eminem case” – which ruled that download and ringtone royalties should be computed at a higher rate under contractual agreements governing licenses and not sales.

Taylor also claims that Warner Bros. asserts it is able to take packaging and free goods deductions from download and ringtone royalties, though the provision is not applicable to the digital sphere.

The suit also alleges other incorrect royalty payments, failure to report royalties, miscalculation of and failure to report foreign royalties, failure to pay some mechanical royalties and unauthorized use of masters on compilation albums, among other claims.

Taylor’s action is being handled by Nashville attorney Richard Busch, who filed Yankovic’s suit and a number of the other individual digital royalties suits.

A Warner Music Group spokesman could not be reached for comment.

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