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Sony’s move to have 19 lawsuit dismissed covers file-sharing legal battle loot

By | Published on Tuesday 22 July 2014


If it gets to court, the legal battle between 19 Entertainment and Sony Music could result in some judicial consideration being given to a number of ongoing royalty debates in the music industry. Though it’s emerged that the major filed a motion to have the case dismissed last month.

As previously reported, 19 Entertainment, suing on behalf of various ‘American Idol’ winners who scored Sony Music record deals via the show, says it found “systemically incorrect calculations” on two separate audits of royalty payments made by the major, adding that the record company then failed to allow 19’s bean counters to access all the data they required to do a full audit.

The 19 litigation also includes disputes over the way digital royalties are calculated, including the much debated issue as to whether labels should be paying lower record sale royalties or higher licensing revenue splits on download and streaming income. As much previously reported, a busload of veteran artists have gone legal on this issue already.

Meanwhile, in a review of the litigation, The Hollywood Reporter notes that 19 Entertainment also raises a web-related royalty gripe that almost pre-dates the debate over how much of iTunes revenue should be shared with artists. And that’s whether the majors are obliged to share with their acts damages received from successful file-sharing litigation.

Sony deals with that argument in its motion to dismiss, arguing that it isn’t obliged to share with artists the multi-million damages stemming from general file-sharing lawsuits – such as the long-running LimeWire legal battle that resulted in a $105 million pay off for the majors – unless recordings from said artist are specifically included in a lawsuit.

But according to the Reporter, lawyers for 19 have already responded to that, arguing that, by their interpretation of the recording contracts signed by Idol winners, the artist is due some kickback from successful catalogue-wide anti-piracy litigation. “Sony has multiple ways to bring suit” they argue. “The manner in which Sony brings suit is of no consequence as to 19’s right to receive a portion of any money which is attributable to artist’s masters”.

It is by no means assured any of this will actually reach court, but if it does, it could result in some clarification on a number of royalty issues raised across the artist community, in the US at least.