Looks like Kenny Rogers isn’t the only legacy artist suffering from suspect major label accounting.
According to legal documents just filed by Toto in New York, Sony Music Entertainment has been similarly difficult and duplicitous over the decades.
A big part of the lawsuit – whether Toto should be paid a much higher royalty on digital assets – is controversial. The rest just seems shady. Here’s the list of some of those complaints.
(1) Since signing with then-CBS Records in 1977 and through 2004, Toto alleged that the label had consistently underpaid the band as stipulated in their contract. Eventually, in 2006, Sony agreed to enter into a ‘settlement agreement’ with Toto to cover the underpayments, but did not remedy the underlying underpayment issues afterwards according to the band.
The amounts were not specified.
(2) Toto then performed an audit for royalty payments between 2006 and 2008, but was unable to secure documents related to various adjustments and account balances. The missing documentation left Toto unable to account for $918,596.18 in “miscellaneous adjustments.”
(3) Eventually, Sony did provide the documentation on these expenses, which revealed $43,561.79 in underpayments mostly related to the mischaracterization of foreign royalties. Sony claimed it had actually overpaid $18,357.35 on these amounts. In fact, Sony claimed broader overpayment of $189,661 during the period.
(4) Not only did Sony claim the overpayments, the label recouped those amounts.
(5) Sony did not offer the band a breakdown between domestic and foreign royalty calculations.
(6) Sony took deductions against Toto for items like television advertising, but did not offer documentation of those buys.
(7) Toto claims that Sony owes the band $49,499.58 for recordings that were not entered into the royalty database. Sony admitted that a mistake occured in this regard, but only for $697.
(8) Toto found that Sony had consistently used the wrong base price in its royalty calculations on records, and used improper deductions. Toto claims that amount is $134,329.89 in domestic sales alone, while Sony says the underpayment was $2,278.
And I was under the impression only small bands suffered this behaviour from labels…
Well, I suposse in some way it’s good that big labels don’t distinguish between large or small bands, and treat them like crap. That makes it much easier to distrust them completely.
Thank the stars for the Internet.
At least Kenny and Toto can afford the accounting firms and lawyers that are required after signing major label deals.
The given information is very effective.
I’l keep update with the same.
STOP THE PRESSES;
Major label screws artist…
Does anyone learn anything from this piece? I doubt it, seems everyone in this piece says one or the other got screwed or is getting screwed.
Most of the people involved from Sony’s part are no longer with the company and I’m sure most people involved with Toto’s business are no longer employed by Toto.
As usual Sony’s lawyers and Toto’s lawyers will get the bulk of any settlement so whta did we learn?
This is the price of fame,success if you work for others. It’s not to say that your future is better off if it’s only in your own hands but then you can only blame yourself.