Cher Lawsuit Highlights How Record Labels Screw Over Artists

from the protecting-the-artists? dept

It’s certainly nothing new to find out that record labels rarely have the best interests of the musicians at heart (despite their proclivity to claim so — especially to Congress and the press). However, a new lawsuit (sent in by a bunch of you) that pits Cher and the heirs of Sonny Bono, highlights some of the many ways that labels screw over musicians. In this case, Cher is alleging that Universal Music funneled revenue through international subsidiaries in order to completely hide how much revenue was made on Sonny & Cher music, in order to avoid paying the contractually agreed upon royalties. Again, such charges of creative accounting are legion in the industry, but it’s nice to see a lawsuit detail exactly how some of the funny accounting is done. Whenever major record label folks insist that the labels have the artists’ best interests in mind, it seems worthwhile to point out these sorts of stories.

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Companies: universal music

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Comments on “Cher Lawsuit Highlights How Record Labels Screw Over Artists”

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Anonymous Coward says:

Weren't these the guys who lobbied for Sonny Bono Copyright Extension?

Funny that artists are also finding that working outside a label is better.

Secondly, It’s nice that Cher is due such a high number– 50% of net in the form of royalties. Perhaps this was so high because of her support of the Sonny Bono Copyright Act. It would be nice if all artists received such high royalty rates.

Thirdly, if anything has been learned from the recent Madoff Scam, overseas entities or subsidiaries are often used to obfuscate income statements. Usually for Tax evasion, people who don’t see value in proper accounting, or similar devious reasons.

Fourthly, I would like to read the amicus brief. Anyone have a case number?

Anonymous Coward says:

Whenever major record label folks insist that the labels have the artists’ best interests in mind, it seems worthwhile to point out these sorts of stories.

Matters such as this are legion in the record and movie business. Of course, these matters are by no means limited to just these businesses.

Perhaps a more accurate way to state things is that “Whenever large business folks insist that they have the employees’ interests in mind, it is worthwhile to point out these sorts of stories.”

Paul Brinker (profile) says:

Why cant artists do the same thing people who deal with hollywood do? Demand Audits, why would Hollywood be in business if everyone movie in history is runing at a loss? Even the guys at Lord of the Rings had to demand an Audit because thay were paid partly on profit and Hollywood was telling them the movie did not make money (as did the person who wrote Forest Gump)

If someome wants to pass a useful law, pass a damm law that holds Hollywood and lables to GAPP just like everyone else.

Anonymous Coward says:

Re: Re:

If someone wants to pass a useful law, pass a damm law that holds Hollywood and labels to GAPP just like everyone else.

Sure, but are notorious for using (and in some cases, possibly abusing) the LLC and LLP corporate entity. Sometimes this is done under the auspice of a public shell corporation.

But at this point, you enter into a discussion of talking about a whole new set of corporate reformation laws that would need to be passed on the scale of Sarbanes Oxley that would pertain specifically to the LLC and LLP entities.

Problem is, we would then get into the Imaginary Property (or IP) argument. Because no one lost their life, was hurt, injured or had Real Property stolen, a Judge may find it difficult to award similar monetary damages or reform IP law. Problem is if enough artists stand up like Cher did.

Perhaps theproblem may be if artists adamantly sought to do business with a publicly traded company that has a flat organizational structure which allows for copious third party review. Today, the closest is Terry McBride, so it’s safe to assume relatively safe.

Anonymous Coward says:

Re: You're absolutely right

You’re totally correct, but artists are often nearly penniless or completely clueless about law, so no audit will happen. The industry loves this, of course. Even if it’s completely in the wrong, all they have to do is stonewall with their legal staff, and outlast the little guys.

And if they see that they could lose, they just quietly settle so no one else will find out, with helpful clauses that don’t allow the plaintiff to speak about the case. A starving artist will take this deal, no matter how bad, just to get anything at all.

Anonymous Coward says:

Re: ha

Probably true, Grant…

But something happened. I’d venture a guess that the label held back writing talent, and perhaps that’s when things changed.

Point is, if she was growing up today and made it to American Idol, Australian Idol, Canadian Idol, Deutschland sucht den Superstar, Indian Idol, Nouvelle Star, New Zealand Idol or World Idol, and had access to any and all musical works, she quite possibly would have been labeled as the next rising superstar.

Ben (profile) says:


There is something incomplete in the summary — “[lawsuit] that pits Cher and the heirs of Sonny Bono, highlights some of the many ways that labels screw over musicians.” The lawsuit pits Cher [& heirs] against who?

Universal Music is mentioned later; if that who she’s suing? Or is it the music industry in general, the RIAA, or someone else entirely?

Considering the history of Sonny & Cher, I doubt that they had much in the way of leverage to insist on audits at the time they signed; I wonder if there is any legislation that provides for the insisting on an audit — but that require auditing the entire business and not just the items associated with just one act, and I could understand the label’s reluctance to agree to that…

Eponymous Coward, AKA Doug (profile) says:

You know,

If I could turn back time, If I could find a way,

I’d stop the Bonos from getting copyright extended in the first place. Granted, it will be great if Cher gives Universal music a good anal raping on this one, but the Sonny and Cher catalog should have been off copyright by now anyway, and so, in my imaginary world, this point is moot. Well it’s moot because of that, and because I don’t care for Cher anyway.

Gotta go get me some Mystic Pizza, you kids have fun.

Paul Brinker (profile) says:

Idealy we are not asking for massive change, only Hollywood and RIAA will paint it as such. What we want is for some way to open the books to a 3rd party and move some power back into the hands of the producer of artwork and away from the a 1 sided contract.

Possably giving a judge the power to order an audit in the case of suspected wrong doing when contracts call for payment based on profit of a work of art when one side says no such profit happend.

The audit could then be held to GAPP with out making Hollywood or an RIAA member or whoever actully have to use it internaly.

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