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Band Sues Record Label for Digital Music Distribution Ripoff

Lawsuit notes that Universal “incurs practically no expenses or risks to create and distribute digital downloads yet UMG reaps millions of dollars every year from such exploitation.”

The Allman Brothers Band have decided to sue Universal Music for more than $10 million USD over royalties from CD sales and digital downloads services, reports Reuters.

The lawsuit, filed in Manhattan federal court, said UMG “refuses to pay Plaintiffs at the correct royalty rate for its digital exploitation of the Capricorn Masters,” including from CDs, digital downloads and ringtones.

The lawsuit centers around a 1985 agreement between the band and Polygram, which Universal later bought, that said the band would be paid half of the profits on any other commercial usage not specified in the agreement like the sale of music downloads on Apple’s iTunes for example.

“UMG incurs practically no expenses or risks in connection with the Masters, particularly with respect to licensing other companies such as Apple to create and distribute digital downloads … yet UMG reaps millions of dollars every year from such exploitation,” the lawsuit said.

The band is rightly angry over the deal since there was no way to foresee in 1985 that one day a record label wouldn’t need to actually manufacture or distribute records, that it would all be done digitally. In their eyes, as well as mine I might add, giving 50% of you profits to a company that doesn’t do a thing is entirely unfair and disproves once again the myth that record labels care about music artists.

Jared Moya
I've been interested in P2P since the early, high-flying days of Napster and KaZaA. I believe that analog copyright laws are ill-suited to the digital age, and that art and culture shouldn't be subject to the whims of international entertainment industry conglomerates. Twitter | Google Plus


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The old artists have all done well for themselves it is the new generation of producers and artists that are hurting badly with the illegal downloads no one as far as I know even knows who the allman brothers are the ones who are their fans are like 50? 60 ? 70 ? they buy cd's well that is if they are still buying and they for the most part do not know what a computer or the internet is or how to use it.

You know it's funny. The Big four are crying that they are being stolen from as well as the musicians by illegal downloads. And what are these guys doing? They are stealing from their own musicians. In the millions. And they just can't understand why nobody feels bad for them. It's just to bad once again it's the bands that get hurt. Hopefully the Allman Brothers will get one over on UMG. They deserve it.

Should the artist have signed the contract? Record contracts, historically, are miserly toward the artist. Example: Elton John's initial 1967 contract with This Record Company was for a royalty equal to: "20 per cent of all net monies recieved by the company in respect of the master recordings, after the cost of musicians, singers, musical directors, orchestrations, copying, cartage of musical instruments, studio-rentals, technicians, tape-costs, editing, dubbing and re-dubbing and all like expenses incurred by the company in respect of any of the master recordings shall first have been recouped by the company." [pg.90, Elton, by Philip Norman]. These terms are not untypical of the era. Note: this does NOT mean 20% of what a record might sell for at retail, it is from NET profit to the record company, not GROSS profit or sale price. The Allman Brothers contract is interesting: What it covers is uses of the music that weren't concieved of within the contract, and specifies the rate of payment: 50% of profit. Is Universal paying the correct amount under that contract? It isn't clear from the article, but considering they are suing for royalty payments my guess is that they believe they are not getting their 50%. Whether new methods of distribution are covered by that same rider is probably open to debate. Given (as is pointed out) that the costs of digital distribution are minisule, the portion of profit is much larger than the physical distribution model ever allowed. Do I think it is fair that the record company gets 50% for "doing nothing"? ("doing nothing" may be the general perception but it is inaccurate - development of the 1000+ other artists that never make it and thus fail to recoup that investment has to be funded from somewhere; but they also have their expenses covered before paying the artist.) I'd prefer to see a sliding scale that tilts toward the artist at the upper end, but that isn't the contract that is before the courts.

we would like you to have a record label for a band aged 12 years old a group of girls. so please will you contact back.

Hi Sarah you may wish to contact Kelvin or Quintin who are looking for a band that is tight, experienced and ready to record material written by a well known writer of rock music. [email protected]

Sarge 2004, hit last FM. That's right, I have friends who are into Elvis and The Beatles. The Allman Brothers are American Southern rock and started in the late 1960s and were popular through the 70s on the album rock charts. They are one of the big acts that made album rock popular I think, with others like Lynyrd Skynyrd. Ramblin' Man must be their biggest song.

The old artists have all done well for themselves it is the new generation of producers and artists that are hurting badly with the illegal downloads no one as far as I know even knows who the allman brothers are the ones who are their fans are like 50? 60 ? 70 ? they buy cd's well that is if they are still buying and they for the most part do not know what a computer or the internet is or how to use it.

I'm 18 and I love The Allman Brothers. Music doesn't just die like that.

You know it's funny. The Big four are crying that they are being stolen from as well as the musicians by illegal downloads. And what are these guys doing? They are stealing from their own musicians. In the millions. And they just can't understand why nobody feels bad for them. It's just to bad once again it's the bands that get hurt. Hopefully the Allman Brothers will get one over on UMG. They deserve it.







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