Peter Frampton has sued Universal Music Group-owned A&M Records for unpaid digital royalties, according to numerous reports. The suit alleges breach of contract and unfair competition and seeks compensatory damages.
At the center of the lawsuit is the way royalties are calculated for digital goods. Frampton’s complaint argues Universal should have paid 50 percent of net receipts, which is typical when music is licensed. But record labels tend to treat digital sales like physical sales, which have a much lower royalty rate.
According to a report in The Tennessean, Frampton’s suit was brought by Nashville attorney Richard Busch, a partner with King & Ballow. Busch was the attorney behind similar suits brought against major labels by Eminem and The Knack’s Bruce Gary. « The issues in these cases go beyond simply breach of contract, » Busch told the Tennessean. « The plaintiffs allege the wrongdoing here is a part of deliberate effort to deprive the parties of their royalties. »
A spate of lawsuits has followed a court victory by F.B.T. Productions and Em2M over digital royalties earned by Eminem, who was under contract with F.B.T. since 1995. F.B.T. claimed to have been underpaid by more than $650,000 from 2002-2005. In September 2010 an appeals court overturned a lower court’s 2009 ruling in favor of Universal and Aftermath Records. Calling the parties’ legal agreements « unambiguous, » the appeals court gave F.B.T. Productions and Eminem 50 percent of digital royalties rather than the 12 percent royalty given for sales of physical albums. The U.S. Supreme Court denied to hear the case earlier this year.
Universal has maintained the Eminem ruling applies to contracts particular to that case and do not set a legal precedent. However, Frampton’s suit is reported to say the language of the agreement between Frampton and A&M is « virtually identical » to F.T.B.’s suit against Universal and Aftermath Records.
Billboard asked King & Ballow’s Busch if the firm had any more suits planned on this issue, considering it filed two in the days before Christmas. In an e-mail, Busch responded, « We are being contacted by artists frequently, and evaluate on a case-by-case basis. »
Additional reporting by Ed Christman.