Michelle Phan Countersues Ultra Records for Licensing Fraud…

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Michelle Phan has countersued Ultra Records. The label originally sued her for copyright infringement.

This case has become a symbol of competing ideologies in the music industry. Highlighting the fact that those who still have faith in traditional label and sales structures are at odds with those who are embracing technology and interconnectivity.

Ultra says Michelle Phan knowingly infringed on their copyright, but Phan accuses Ultra of sinister activity.

Phan is one of the most popular YouTube personalities. Her makeup tutorial videos get millions of views and her channel has 6.98 million subscribers. She regularly secures endorsement deals, and reportedly made $5 million in 2013.

Ultra Records said Phan illegally used 45 different songs in her videos. 43 of these songs are either the sole work of Kaskade or a collaboration between Kaskade and other artists. The remaining two songs are by Haley, who often collaborates with Kaskade.

Kaskade voiced his support for Phan, tweeting:

“File under “For Real?”: @MichellePhan being sued by @ultrarecords for my favorite…copyright infringement…. And the kicker..they’re citing her using my songs for the suit. Come. On… Copyright law is a dinosaur, ill-suited for the landscape of today’s media.”

+Kaskade: “Sharing Helps the Artist, the Fan, and the Music Industry”

Phan’s countersuit, filed September 18th, says Ultra gave her permission to use their music in her videos.

She says that in 2009 she contacted Ultra’s Senior New Media Manager Jason Kilgore. She asked Kilgore if she could use Kaskade’s music in her YouTube videos if she credited the artist and included an iTunes link. Kilgore said Ultra was “more than happy” to let her do this. According to the countersuit, “Phan and Kilgore then began to discuss in writing how this agreement would work in connection with YouTube’s ‘Content ID System’.

Kilgore told Phan that “whenever YouTube made a claim on one of Phan’s videos using a Kaskade song controlled by Ultra, he would release that claim“.

Going forward, Phan, Kilgore, and other Ultra employees communicated about her use of music by Kaskade and other Ultra artists. Ultra employees removed claims on Phan’s videos that used music by a number of Ultra artists. Kilgore told Phan on multiple occasions that he could remove any claim for her, and he did it for four years.

“During this four year period, Ultra representatives offered suggestions to Phan as to particular tracks by Ultra artists that she should use as background music in her videos. A number of Ultra representatives, including Ultra’s Senior Director of Marketing and PR and Senior Manager of Interactive Marketing wrote to Phan that they loved what she was doing with the music by Ultra’s artists. Other Ultra representatives sent Phan music tracks by Ultra artists that they suggested that she use in her YouTube videos, asking only that she post a link to purchase for her subscribers. Ultra representatives posted comments to Phan’s YouTube videos thanking Phan for helping to support Ultra artists.”

Every time Phan used Ultra’s music, she would credit the artist and include an iTunes link, per her agreement with Kilgore.

“On March 18, 2014, Ultra’s General Counsel wrote to Phan and insisted for the first time that any use by Phan of music by Ultra’s artists (including all the songs that Ultra had allowed Phan to use and which Phan had used for several years with Ultra’s knowledge and approval) was “unauthorized” and demanded that she cease and desist from using any music from Ultra’s artists.”

Phan says that in June and July of 2014, Ultra sent takedown notices to YouTube for 12 of her videos. Ultra previously said she could use the music in these videos, and Kilgore had previously removed a claim on one of these videos.

YouTube removed all 12 of these videos, cutting off their ad revenue. She filed counter-notifications and some videos were reinstated.

Phan’s countersuit says that Ultra gave “express or implied consent” to use their music, and that Ultra reiterated this by supporting her use for years. She says she held up her end of the deal by crediting artists, exposing them to her fan base, and posting iTunes links, and that Ultra cannot back out of their end of the deal.

She also says Ultra’s takedown notices were sent in bad faith and that they knowingly misrepresented her use. She is seeking damages for this.

Furthermore, she accuses Ultra of attempting to disrupt her contract with YouTube’s Partners program with “fraud, oppression, and malice”. She is also seeking damages for this.

Read the countersuit here.

 

Nina Ulloa covers breaking news, tech, and more. Follow her on Twitter: @nine_u

 

33 Responses

  1. Anonymous

    “This case has become a symbol of competing ideologies in the music industry”

    It’s nothing of the sort. There are only two possibilities:

    1) Ms. Phan has written permission to use the content, or…
    2) Ms. Phan doesn’t have written permission to use the content.

    Winner takes all.

    Reply
    • Nina Ulloa

      Her having or not having permission are obviously the two possibilities. When I say “symbol” I do mean “symbol”, not that it is a deciding factor of the case. Look at what Kaskade is saying, then look at those on the other side of his arguments… That’s what I meant.

      Reply
      • Yup

        I don’t think it is what you describe in your hyperbolic sentence either. It’s not “symbolic” of anything other than trying to screw a songwriter, whether he’s a willing oatipant or not. Ultimately, neither this woman or the label gives a shit about the songwriter other than what they can get out of his labor. Period.

        Reply
        • Anonymous

          “It’s not “symbolic” of anything other than trying to screw a songwriter”

          Well, we don’t know that yet.

          All we know is that A is trying to screw B — it’s impossible to say if Ms. Phan is A or B.

          Reply
  2. Phil

    If this fool thinks copy right is a dinosaur then why sign that record deal? Why not release is songs as creative commons? Doesn’t make sense.

    Reply
  3. industry Manager

    @Nina It matters not what Kaskade thinks or wants for that matter and you know that. He does not own or control the sound recordings, therefore his words mean absolutely NOTHING!

    Reply
  4. MMG

    Ultra Co. is nothing but a backstabbing selfish #%$! that only wants even more money for their greedy ass net worth. I’ve seen many of Michelle’s videos and she always credits the artist and provides a link for purchase.
    And being an watcher of her videos, I barely pay attention to the music! All focus is on her and her voice and you only realize she using a “popular” song in the credits at the end of her videos!
    This is where the verse in the Bible says ” It’s easier for a camel to enter through the eye of a needle than a rich man”. Definition for Ultra Records: Greedy,Bully,Backstabbing.
    I will not support any of Ultra at all!

    Reply
  5. CC

    It is such BS, I can’t believe they’re doing this to her. :\ I found many great artists through her YT videos, and surprise, even purchased their songs. I wonder if this has anything to do with their merger with Sony Records? :\ Greedy, greedy, greedy. Attacking someone who has no doubt helped the fanbase of their musicians, seems like really bad business, especially considering Michelle’s huge fanbase.

    Reply
  6. JeffC

    If she didn’t get an actual license then it’s her own fault.
    And can you really imagine that a label, of any size, in this day and age, would verbally permit sync usage like this?
    Whether you perceive the ‘copyright industry’ to be a dinosaur or not is irrelevant.
    It’s the law.
    It’s amazing how little understanding some people have of how things actually work.

    Reply
    • Anonymous

      “It’s amazing how little understanding some people have of how things actually work”

      It’s not that odd — everybody wants to be publishers, but nobody wants to learn the basics. And it’s actually not that easy to find reliable information about IP law either; not if your only source is the internet.

      So a lot of people just drive around without license until they crash. And when they crash, they blame the laws. 🙂

      But again, nobody knows what’s up and down in this case yet. Ms. Phan would hardly countersue if she didn’t have some kind of written permission to use the content, and if she does it’s going to be very expensive for Ultra.

      Reply
    • JTVDigital

      Using someone else’s music on YouTube does not require a sync license, well in theory yes but in practice no, this is all handled by ContentID.
      All labels, big or small, make money on YouTube thanks to ContentID and UGC (User Generated Content).
      There is certainly some bit of info we don’t have here, that would explain the sudden reaction of the record label.
      This YouTuber is popular, her videos make tons of you, meaning any music used on these generates a very comfortable income for the copyright owners (via the ContentID / claim procedure).
      Why would they suddenly act like that given the potential loss of income? Sounds quite smokey.

      Reply
  7. hippydog (site still will not let me log in)

    the copyright law does NOT specifically state you need a license or that it needs to be a 20 page contract..
    What it does state is you need permission from the copyright holder..

    Which is why this should be an interesting court case..

    If she has copies of the emails they sent to here, that in anyway show implied consent, she has a very good chance at winning this case..

    either way I hope Nina keeps following this, it may be interesting 🙂

    Reply
    • JeffC

      Try running THAT past your attorney.
      Sad thing is, they [the attorneys] will be the winners regardless of the outcome.
      Nothing is done via “implied consent’ or without an actual license.
      Seriously.
      Nothing.
      A handshake isn’t worth the paper it’s printed on.

      Reply
      • Anonymous

        “A handshake isn’t worth the paper it’s printed on”

        Except if it IS printed… 🙂

        Makes all the difference. Hippydog is right — you don’t need a 20 page contract. One line on the back of a napkin will do.

        Reply
  8. JeffC

    Ultra has attorneys. They would never allow ANYTHING to be licensed via “One line on the back of a napkin”. The ‘he said’/’she said’ would never hold up.
    20 pages? Perhaps not, but once you get into the nuts and bolts it would be at least a few pages.
    And this would have to be both a sync license and master use license [even if the label and publisher are one and the same].
    I really don’t mean to sound like an arrogant jackass [probably too late for that, right?], but have you ever actually done anything in the Music Business?

    Reply
    • hippydog_site_still_will_not_let_me_login

      yes,yes & yes..

      IE: yes, I have talked to my lawyers about almost the exact same area (copyright permission)), Yes you sound like an arrogant jackass (but since I have no idea who you are, I really dont care), and no I am not a working musician, but yes I have been involved with the entertainment business most of my life

      Here is where I should also require YOU to somehow prove your credentials, but honestly, I again dont really care, as i know whenever someone pulls the “your not a musician” its usually the first sign of the person arguing not having a fricken clue..

      Reply
  9. JeffC

    Prove my credentials?
    25 years in the business including 5 years as VP Business Affairs and 7 years as COO of label that sold ~100 million records, including sample licensing and master use licensing for film use.
    I never said to anyone “your not a musician” – I merely question anyone that brings up that quaint but worthless “scribbled on a napkin” line.
    So yeah, I have no clue ;0)

    Reply
  10. Gads

    Oh man, I am laughing my ass off… Phan’s done a bunch of stupid things in the past, but I could see the copyright claims coming a mile away. If she doesn’t have definitive legal written proof that she was allowed to use this music, then there’s nothing she can do. Implied consent means jack shit.

    Equally retarded is Kaskade’s unwanted two cents in this whole debacle; he admitted on his own blog that he was stupid enough to hand over ownership of his songs to Ultra, “When I signed with Ultra, I kissed goodbye forever the rights to own my music. They own it. ” So his voice in this is completely meaningless. He has no say in who’s allowed to use his music. Saying he supports someone means absolutely nothing.

    I’m always amazed at people that lie or feign ignorance when they use music that isn’t their own. If you’re not doing it for profit then I honestly don’t see the harm, and most companies simply have Youtube either remove the offending music or slap an ad on it to make it kosher. … But if you’re knowingly profiting off of a video that has music you didn’t make, then you deserve everything you get.

    Reply
  11. chris

    Open and shut case. Phan will win.

    Ultra gave consent through emails and even confirmed with Youtube on multiple occasions that she had the right to use the music. Furthermore Ultra sent her digital copies of certain songs and asked her to play them. Ultra will be lucky if they are only found guilty of fraud.

    This is nothing more than Ultra being opportunistic and trying to steal from others, which is ironic as that is what they are claiming others are doing to them.

    Reply
  12. Matt

    Lol fuck Michelle Phan, I hope she gets sued to bankruptcy.. She makes success off of other successful things like make-up and Kaskade.
    I guess that makes sense, must be hard to be creative being just a pretty face with a bland personality.

    Reply
    • BlankityBlank

      One, sounds like you are a bit jealous. And two, she isn’t successful because make-up and Kaskade. She is successful because she KNOWS HOW TO USE the make-up and TEACHES OTHERS TO USE the make-up. The music is just background noise. Anybody who thinks that she makes money by using his music is basically saying that people specifically look up her videos to listen to Kaskade’s music. That’s one of most retarded things I’ve ever heard.

      Reply
      • Brock

        Agree with you 100%. I never heard of Michelle Phan until today when I read she is accompanying Michelle Obama to Japan…I wondered who she was…etc…I am sure most of the young women watching these tutorial videos could really care less what the music in the background sounded like..they are watching and listening to advise from Ms Phan.

        Reply
  13. Jamlimited3

    If you ever needed proof that these labels are soul-less blood sucking beats seeking any way to exploit people and drain them of all their blood-life AND some to the negative and beyond like a giant Godzilla sized tick trying to suck the blood out of a baby………I mean seriously this is some Matrix robots using humans as batteries type ish. I hope 2015 reveals we have come far enough to do away with the era of misinformation, middle-man leeches, and the living dead companies trampling on family trees EFFING the world up all for the almighty dollar spent so vainly as people starve to death. The internet is more than it seems….this is the age to cut out the middle man and join arms as many talented folk pioneer a way for many of us to make a successful living honestly and w/o fear of venomous entities like these companies waving a contract with some dirty plot to suck us dry.

    Reply
  14. Rina

    This is so pathetic, if you think about it Kaskade, Haley, and other artists gained a significant amount of publicity from Michelle’s videos. I myself had no idea who Kaskade was until the first Michelle video I watched featured his work- this was about 6 years ago, and now I own most of his albums and tracks. That being said I KNOW I’m not the only one who first found out about the various artists under Ultra through Michelle. There are thousands of comments complimenting the music under her videos- I would even go as far as to say that part of Kaskade’s public success can be attributed to his exposure by other’s on youtube in their own videos. I mean really, how often do you come across a video, hear the background music, and like it? Or better yet, how often do you “find” new music after watching another youtuber’s video but not the actual music video?
    Often enough. Vines are a great example of that.

    Kaskade is right, this suit is ridiculous.

    Reply

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