January 07, 2012 4:47pm PT by Eriq Gardner
Bob Marley Family Settles Royalty Dispute With Universal Music
Bob Marley's estate has settled a lawsuit that challenged Universal Music Group's hold over key recordings by the reggae legend and also claimed underpayment of royalties from digital downloads. On Thursday, a federal judge in New York overseeing the case accepted a stipulation by the parties to dismiss the dispute without prejudice.
Marley's estate brought the lawsuit in July 2008, alleging that UMG had underpaid millions of dollars of royalties since 2001. Later, the plaintiffs amended the lawsuit to assert for the first time that they owned the renewal term of the copyrights to such 1970s albums as Catch a Fire, Burnin', Natty Dread, Rastaman Vibrations and Exodus. Marley recorded these albums with the Wailers and they included classic songs like "Get Up, Stand Up," "I Shot the Sheriff," "No Woman, No Cry" and "One Love."
In September 2011, U.S. District Judge Denise Cote handed UMG a big victory by concluding that the recordings were "works made for hire," thus establishing the label as the author of the works for purposes of copyright law.
As to the question of underpayment on digital downloads, Judge Cote looked at the various contracts and said it was "ambiguous" which agreement between UMG and an entity controlling Marley's affairs should govern royalties on digital downloads.
One signed document gave Marley's estate 60% of receipts from music sold or licensed through "direct transmission to the consumer over wire or through the air" whereas another signed document applied traditional royalty calculations for "records released in formats newly developed as a result of advancing technology."
The question over what portion of digital revenue that record labels should hand over to recording artists is a controversy that is currently being waged in several ongoing lawsuits around the country.
In this dispute, after the ruling last November, the judge ordered a settlement conference, and after more than a year of back-and-forth, the litigation has finally been put to rest. The terms of the settlement haven't been revealed. UMG hasn't yet responded to our request for comment.
Among the people probably relieved by the outcome is U.S. District Judge Katherine Forrest, a former top antitrust and IP attorney who was recently put on the bench and assigned this case in a random reassignment of the docket in November. Among Forrest's pre-judge work as a partner at Cravath, Swaine, & Moore was representing Time Warner in pursuit of digital rights to music and helping lead the early charge for UMG and other labels against LimeWire.
Last month, Forrest denied requests from the Marley plaintiffs that she recuse herself by saying she wouldn't be biased, a decision that might have put some doubt on any trial verdict in the event of an appeal. But now, the case is over anyway.