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Death Row goes to Canadian company for eighteen million

By CMU Editorial | Published on Friday 16 January 2009

So, I’d only set aside seventeen million dollars for my bid for legendary hip hop label Death Row Records, so damn those Canadians at WIDEawake Entertainment Group who secured ownership of Suge Knight’s former business empire for $18 million.

As much previously reported, Death Row was put up for sale after the aforementioned Knight declared himself bankrupt.

The bankruptcy was caused by a bitter legal battle between him and one of the label’s co-founders, Lydia Harris, who had sued for the millions she reckoned she was owed by the record company in return for her and her ex-husband’s original investment. The courts awarded Harris a $107 million pay out, sending Knight into bankruptcy.

When the bankruptcy courts originally put Death Row up for sale there were at least three interested buyers, including Warner Music and Koch, but both of those companies eventually withdrew their offers because Knight’s shambolic paperwork made it very difficult to say who really owned some of the more valuable recordings, like the early works of Tupac Shakur, Snoop Dogg and Dr Dre.

In the end a consortium called Global Music bought the label for $25 million. But it was revealed earlier this month some of the key investors behind that deal had got cold feet and as a result Global wasn’t able to raise the twenty-five mil required.

With the Global deal dead in the water, the hip hop catalogue went back on sale at auction yesterday, with WIDEawake the successful bidder.

The difference between the $25 million bid by Global and the $18 million to be paid by WIDEawake is significant. It’s thought that after ever-mounting legal and administrative fees relating to Knight’s bankruptcy and the sale of the label have been paid, and the always first in the queue tax man has taken the money he’s owed, there won’t be much left from the eighteen million, meaning Harris and the label’s other creditors are unlikely to see anything.

Harris, needless to say, isn’t very happy. She’s told Billboard: “This was all a scam from the beginning. Everyone wanted me to bring judgment down, and so I brought on the case. But now I’m not getting paid because I’m an unsecured creditor? Yet, administrators are getting paid and Suge [Knight]’s bills are still getting paid? If it wasn’t for me no one would be getting money. They made sure it happened this way because I was the biggest creditor. There must be some internal thing going on and I’m obviously not in on it”.

Harris added that another company called Conquest Media also bid for the label but their offer was overruled because it missed the court-set deadline. It’s not clear what sum they bid, though the implication is that it may have been higher than WIDEawake’s bid.

Toronto-based WIDEawake is run by lawyer, songwriter and entrepreneur Lara Lavi. She distributes releases through Universal in Canada, but doesn’t currently have a US deal in place, so will be looking for a distribution partner to help capitalise on the Death Row catalogue in the American market.

Commenting on her plans for the Death Row recordings, she told Billboard: “We’re very respectful of Death Row’s legacy and when the time is right we’ll announce [our plans]”.