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House label Trax tries to get most of the Mr Fingers lawsuit dismissed

By Chris Cooke | Published on Tuesday 10 November 2020

Chicago-based Trax Records has formally responded to a lawsuit filed against it by musicians Larry Heard and Robert Owens earlier this year. The label argues that all but one of the duo’s claims should be dismissed by summary judgement. That would leave just the breach of contract allegation standing.

Heard – aka Mr Fingers – worked with Trax in the mid-1980s. Along the way, he signed a number of agreements with the label on the back of which Trax exploited various songs and recordings he had made, some of which were collaborations with Owens. The label also registered some of those works with the US Copyright Office.

However, in the lawsuit they filed with the courts in Illinois back in June, the two musicians argued that those agreements didn’t cover all the tracks that the label has been exploiting; that they only talked about the song copyrights and not any accompanying recording rights; and – although the documents were titled ‘Assignment Of Copyright (Musical Composition)’ – at least two of them were, in fact, mechanical licensing agreements rather than contracts that transferred the ownership of any copyright.

Therefore, that lawsuit concluded, the label didn’t have any of the recording rights it has been exploiting, didn’t have all the song rights either, nor the right to register itself as the owner of many of those works with the Copyright Office. On top of that Heard and Owens claimed they hadn’t been paid the royalties they were due from the label.

Among other things, the lawsuit accused Trax of fraudulently registering itself as owners of works with the Copyright Office, violations under the Illinois Consumer Fraud Act, copyright infringement, unjust enrichment, breach of good faith and breach of contract.

In its response, filed with the court this weekend, the label presents an assortment of legal arguments as to why the court should immediately throw out all of those claims except the one for breach of contact.

Trax Records was co-founded in 1984 by Larry Sherman, who died in April this year. It is now seemingly run by Rachael Cain, who originally signed to the label as an artist and subsequently became Sherman’s business partner.

Over the years many artists signed to the label complained about the way they were treated and unpaid royalties, and Cain acknowledged those controversies at the time of Sherman’s death. Although she insisted that, in more recent years, Sherman had been seeking to sort out the payment of past royalties, partly via litigation with a former distribution partner.

Alongside its legal arguments against all but the breach of contract claims, the label’s legal response also criticises Heard and Owens for waiting until after Sherman’s death to go legal.

It states: “In 1986 and 1987, Trax Records’ founder, Larry Sherman, registered its copyright to compositions and sound recordings in Heard and Owens’ music. For over 34 years, Mssrs Heard and Owens did not contest the validity of Trax Records’ copyright, sue for allegedly unpaid royalties, or raise any other claims in court. That changed two months after Mr Sherman’s death on 4 Apr 2020, immediately prompting plaintiffs’ filing of this litigation knowing that Mr Sherman was no longer able to defend himself against plaintiffs’ various allegations”.

Heard and Owens did actually have an explanation for why they were suing now – so long after signing the deals with Trax – when filing their lawsuit back in June. The two musicians now work with London-based music firm TaP, support from which, they said, had enabled them to begin this legal battle.

We now await to see how the musicians and/or TaP respond to Trax’s legal filing.