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Universal Music Group and Vivendi are being sued for allegedly underpaying royalties on Player’s 1977 hit “Baby Come Back.”
Overrated Productions this year acquired rights to the work from producer Dennis Lambert and his Haven Records. It claims to have discovered UMG, which inherited licensing rights from RSO Records through a series of acquisitions, is willfully underpaying royalties and had been concealing it by providing statements that were “intentionally confusing at best and misleading at worst.”
The song is still actively licensed, according to the complaint, and has recently appeared in everything from The Simpsons to Toyota commercials.
According to the suit, filed Monday in Los Angeles County Superior Court, the rights and accounting for the master recordings were transferred to a European entity to artificially lower royalty payments by skimming 25 percent off the top for an “intra-company payment.” Therefore, Overrated argues, UMG has failed to pay the correct amounts for synchronization licenses, record sales, digital downloads, ringtones, streaming and other licenses of the masters.
Overrated is suing for breach of contract and unfair competition. It is seeking at least 19 percent of the relevant profits — up to complete restitution of all profits — and is asking the court to rescind the contract and order defendants to return the masters and associated materials.
UMG has not yet commented on the lawsuit.
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