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Universal Music Refutes Claims of Last Artist in Lawsuit Over 2008 Fire, Requests Dismissal

UPDATED: In court papers filed late Monday, an attorney for Universal Music Group refuted the claims of the final remaining artist filing suit over masters lost in a 2008 fire, providing evidence in the form of emails that the artist in question, Soundgarden, had been informed that masters were lost. The company requests the dismissal of the suit within 24 hours.

In a declaration, Scott Edelman, an attorney for UMG, wrote: “I informed Plaintiffs’ counsel that  UMG had discovered written correspondence with Soundgarden belying Plaintiffs’ allegation that to this day, UMG has failed to inform Plaintiffs whether any of their Master Recordings had been destroyed in the fire. Specifically, I noted that UMG expressly told Soundgarden over four years ago that UMG had lost in the fire two compiled album master 1⁄2 analog reels of one Soundgarden album ‘Badmotorfinger’ but that UMG was still able to issue a remastered release of this album with Soundgarden’s knowledge and participation, using a digital audio tape safety copy.” The letter continues, “I further explained to Pla UMG currently has 1301 assets in its vault related to Soundgarden and that only 21 assets were impacted by the fire, none of which were multitrack masters.

“I have previously written you as to why you should immediately drop the other plaintiffs besides Soundgarden,” he concludes, “because UMG’s investigation has confirmed that no original master recordings embodying their performances were lost in the fire. You should immediately drop Soundgarden as a plaintiff as well. As shown in the attached emails, they and their representatives have known since May 2015, at the latest, that UMG lost Soundgarden-related assets in the fire. That you would accuse UMG of fraud for failing to inform Soundgarden of loss from the fire shines a bright light on your failure to conduct pre-suit diligence in your rush to be the first to file.”

Attorney Howard King, a partner with King, Holmes, Paterno & Soriano who is representing artists whose work may have been lost, was unimpressed with Edelman’s statement.

“For 10 years, UMG concealed from artists the damage the fire inflicted on their life’s works,” King told Variety Tuesday. “Why would we accept anything they say at face value now, especially since they refuse to provide us with their actual testimony given, under seal, detailing losses of masters they claimed in their $100 million damage lawsuits against NBC Universal and their own insurance company?”

Last week, the company In a follow-up to an amended complaint filed Friday from attorneys representing Soundgarden, Steve Earle and the estates of Tom Petty and TupacUniversal Music Group provided evidence that three of the four remaining suing artists — Steve Earle and the estates of Tom Petty and Tupac Shakur —did not lose masters in the 2008 fire. One of the artists in the original lawsuit, Hole, withdrew after Universal determined it had not lost masters in the fire. Universal filed to dismiss the suit in July.

The documents say that some of the artists did lose assets in the fire, but they were tape copies or other secondary material, or items for which there exists a “viable alternate.”

Since the extent of the fire’s damage was revealed in a New York Times article earlier this year, UMG has acknowledged that the destruction was indeed devastating and the company’s previous management did not fully reveal it. Yet it also said that the Times, which published a long list of artists whose archives were said to be destroyed, overstated the extent of the damage, saying that it was based on inaccurate or incomplete information.

The updated complaint was filed in response to UMG’s attempt last month to have the lawsuit dismissed. The artists’ suit seeks “50% of any settlement proceeds and insurance payments received by UMG for the loss of the Master Recordings, and 50% of any remaining loss of value not compensated by such settlement proceeds and insurance payments.” In a 2009 legal action against NBC over the fire, UMG reportedly valued its losses from the fire at $150 million.

The fire, which destroyed an estimated 500,000 master recordings by artists ranging from Billie Holiday to Nirvana, took place in a Los Angeles facility UMG had rented from NBC. “UMG did not protect the Master Recordings that were entrusted to it,” the lawsuit reads. “It did not take ‘all reasonable steps to make sure they are not damaged, abused, destroyed, wasted, lost or stolen,’ and it did not ‘speak[] up immediately [when it saw] abuse or misuse’ of assets,” it continues, quoting statements from the company’s website. “Instead, UMG stored the Master Recordings embodying Plaintiffs’ musical works in an inadequate, substandard storage warehouse located on the backlot of Universal Studios that was a known firetrap. The Master Recordings embodying Plaintiffs’ musical works stored in that warehouse were completely destroyed in a fire on June 1, 2008.

“UMG did not speak up immediately or even ever inform its recording artists that the Master Recordings embodying their musical works were destroyed. In fact, UMG concealed the loss with false public statements such as that ‘we only lost a small number of tapes and other material by obscure artists from the 1940s and 50s.’ To this day, UMG has failed to inform Plaintiffs that their Master Recordings were destroyed in the Fire.”

Despite the extent of the damage, a major-label attorney told Variety that artists’ attempts to sue UMG over the fire faced a steep challenge, because contractually most if not all of the physical master tapes were the property of UMG — not the artists. For that reason, the company was under no obligation to inform effected artists about the damage, the attorney said. The ownership distinction here comes down to the difference between the master tape or hard drive as a physical object, which in nearly all cases is the property of the label, as opposed to the copyrighted intellectual property (i.e. the sound recordings) contained on that master.

 

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