’90s hip-hop group Black Sheep are going after Universal Music Group to the tune of $750 million. According to a Rolling Stone report published on Wednesday, the rap duo filed a hefty class action lawsuit against Universal over unpaid royalties due to an alleged side deal with Spotify. Black Sheep, comprised of members Andres “Dres” Vargas Titus and William “Mista Lawnge” McLean, claim that UMG owes over $750 million to themselves and their entire artist roster for breeching contracts with a “sweetheart” deal with the music streaming platform.
Titus and McLean also claim that UMG accepted cash and company stock from Spotify in exchange for music from their artists, only to “shortchange” artists when distributing royalty payments. In the lawsuit, Titus and McLean said that the “previously undisclosed” deal violates the contract they have with former Universal subsidiary Polygram. Through Polygram, UMG is required to pay 50 percent of all net receipts connected to exploitation of the duo’s music.
“In the mid-2000s, Universal struck an undisclosed, sweetheart deal with Spotify whereby Universal agreed to accept substantially lower royalty payments on artists’ behalf in exchange for equity stake in Spotify – then a fledgling streaming service,” the documents read. “Yet rather than distribute to artists their 50 percent of Spotify stock or pay artists their true and accurate royalty payments, for years Universal shortchanged artists and deprived plaintiffs and class members of the full royalty payments they were owed under Universal’s contract.”
In response to Rolling Stone, a UMG spokesperson called the allegations “false and absurd.”
“Universal Music Group’s innovative leadership has led to the renewed growth of the music ecosystem to the benefit of recording artists, songwriters and creators around the world,” they stated. “UMG has a well-established track record of fighting for artist compensation and the claim that it would take equity at the expense of artist compensation is patently false and absurd. Given that this is pending litigation, we cannot comment on all aspects of the complaint.”
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