Universal Music Group (UMG) was hit with massive accusations recently in a jarring lawsuit from nu-metal band Limp Bizkit. The band claimed that they had never received any royalties for their music for the entire duration of their career. This lawsuit contains accusations of breach of contract, copyright infringement, negligent misrepresentation and more and has potentially massive rippling effects for not only UMG but the industry as a whole.
Limp Bizkit lead singer Fred Durst and his record label, Flawless Records, took to the Los Angeles courts on Oct. 8 to open a case against UMG for their policies regarding royalty payment to artists. Durst argued that UMG had purposely utilized software to misrepresent and withhold these royalties to keep the profit for themselves. This issue came to light in April of this year when Durst revealed to new representatives that the band never received any royalty payments from UMG. Initially, the reason given to the band for the lack of payment was that Limp Bizkit’s royalty amounts were still below the threshold of upfront advances covered by UMG and that this amount would have to be surpassed for the band to receive it.
However, due to the band’s enormous success and significant increases in assets and attention in recent years—even without the release of new work—the band’s representatives doubted the validity of this statement. Subsequently, they pressed UMG for further information on the royalties they held in Limp Bizkit’s name. The band’s representatives then discovered that UMG withheld over $1 million in royalties from the band that were never properly accounted for or documented. Further probing revealed that UMG never issued royalty statements at the height of their career, and much of their revenue was misrepresented to ensure it would appear that the band remained below the level of upfront advances.
This lawsuit covers issues not only related to the royalties the band is owed but also to practices and systems within UMG that Limp Bizkit claims were created with the sole intention of withholding payment from artists. The band and their representatives have expressed fears that the ramifications of these dishonest practices from UMG may have likely stretched far beyond just their band, affecting hundreds of other bands and artists in the industry. In the official legal complaint, they stated their concern regarding other artists being kept “in the dark about positive balances in their accounts,” making clear that they believe this corrupt behavior from UMG exists on quite a large scale. In their lawsuit, they claimed, “Not only did UMG never have any intention of paying Plaintiffs, it designed and implemented royalty software and systems that were deliberately designed to conceal artists’ (including Plaintiffs’) royalties and keep those profits for itself.”
UMG has been asked to comment on these accusations and has been largely silent. In addition, Limp Bizkit and their team have yet to issue official statements outside of what is contained in the lawsuit documentation, as they believe it largely speaks for itself at this time.
