WMG Settles Royalty Lawsuit

Warner Music Group has come to a settlement valued at a minimum of $11.5 million in a class action lawsuit regarding its process for calculating royalties on downloads and mastertones of recordings. In the suit, Warner Music Group denies any wrongdoing.

People who have received royalties from contracts dated prior to Jan. 1, 2002 with a WMG U.S. label, paying on a royalty rate basis or penny rate basis, could be eligible for payments on past royalties, and/or an increase in future download and/or mastertone royalties. The increased future royalties give artists an increase in five percentage points in their royalty rate on U.S. mastertones and downloads (possibly more, if necessary to reach a floor of 10 percent and a cap at 14 percent), as well as 2.5 percentage point increase in foreign exploitations.

Valid claims must be submitted by May 31, 2014.

Persons electing to retain the right to sue the label group are required to exclude themselves from the settlement by May 31, 2014. Those who stay in the settlement may object to it by May 31, 2014. The court hearing will be held Oct. 2, 2014, to determine approval of the settlement and a request for attorneys’ fees of up to $2,875,000, plus reimbursement of costs and expenses.

For more information regarding the settlement, visit wmgdownloadsettlement.com.