Action is the latest in series of suits over digital underpayment
Heritage recording acts are continuing to pile on their labels with digital royalties suits, as Boz Scaggs and REO Speedwagon have both lodged federal suits against Sony Music Entertainment.Both breach of contract actions were filed in New York federal court Sept. 19. Nashville-based attorney Richard Busch is repping both acts; he filed James Taylor’s recent suit against Warner Music Group (Daily Variety, Sept. 17), and is handling several other individual royalties claims by other heritage performers. Like more than a dozen other class action and individual suits filed against the major labels since early last year, the Scaggs and REO actions cite 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. The damages phase in that case is pending. Singer-guitarist-songwriter and former Steve Miller Band member Scaggs was one of Columbia Records’ top acts of the ’70s. His hit LPs of the era included the double-platinum 1976 set “Silk Degrees”; he logged three more platinum sellers through 1980. His top 20 hits of the era included “Lowdown” (No. 3 in 1976), “Lido Shuffle,” “Breakdown Dead Ahead,” “JoJo,” and “Look What You’ve Done to Me.” REO Speedwagon began their career on Epic in 1974. The Illinois group peaked in 1980 with “Hi Indidelity,” which held the No. 1 spot on the U.S. album chart for 15 weeks and sold 9 million copies; the album spawned the No. 1 single “Keep On Loving You.” In all, the rock unit released seven multi-platinum or platinum albums on the label. Both acts claim that they are contractually entitled to 50% of net receipts on masters leased by Sony, and that the company has systematically underpaid them for downloads and ringtones since Jan. 1, 2009. Actions claim underpayment is in excess of $150,000. A Sony Music spokesman could not be reached immediately for comment.