‘American Idol’ Battles Royalty Lawsuit
It has been a rocky start to 2014 for the popular TV show American Idol, as it is now involved in a lawsuit over royalties. Sony, one of the world’s biggest record labels, is being accused of stealing millions of dollars- worth of royalties. All of the past winners of “American Idol,” including Carrie Underwood, Jordin Sparks and Kelly Clarkson are represented by the Core Media Group, which is the parent company of 19 Recordings, the record label past “American Idol” stars are now signed to. As fans of the show may or may not know, 19 Recordings is owned by the man who first created “American Idol.”
According to the Core Media Group, Sony has withheld royalty payments that they should have received. Recording agreements made between the Core Media Group and Sony allegedly have not been met and this was determined when Sony’s financial books were audited by 19 Recordings.
This lawsuit could have been avoided if the two companies had been able to come to an agreement when this first came to life. Instead, 19 Recordings felt that Sony was not going to be cooperative and proceeded with the law suit in an effort to protect the interests of all their signed artists.
19 Recordings is seeking damages from Sony in the amount of $10 million. The company feels that Sony did not pay the amount of money they should have when it came to royalties for music videos and the digital streaming of their artists’ music as well as albums compiling the greatest hits of many of their artists. Sony is arguing that a compilation album is not actually an album and not subject to royalties. They are also being accused of incorrectly deducting income taxes from foreign countries as well.
Sony is claiming that, contrary to what 19 Recordings believes, they actually paid more than they should have when it comes to royalty payments regarding the downloading of digital tracks.
The outcome of this case will be decided by the court system of New York. It will be interesting to see what is decided about this “American Idol” lawsuit.
Sources: http://www.huffingtonpost.com/2014/02/21/american-idol-sony-music-lawsuit_n_4832842.html?utm_hp_ref=tv&ir=TV; http://www.hollywoodreporter.com/thr-esq/bombshell-american-idol-lawsuit-claims-681625