Zync Music Sues Round Hill Over JV Deal Turned Sour, Seeking Millions in Damages for Alleged Breach of Contract, ‘Bullying and Mistreatment’

Round Hill Music
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Round Hill Music
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Photo Credit: Round Hill Music

Zync Music is suing Round Hill over a number of alleged contractual violations – including a failure to cough up millions in allegedly owed payments – stemming from an investment and JV deal turned sour.

22-year-old Zync, still billed on LinkedIn as a “Round Hill company specializing in synch & creative publishing,” reached out today with word of its legal action. Round Hill initially announced a tie-up with Zync back in November of 2017; Santa Monica-based Zync describes the transaction as an asset purchase and a “joint tenancy agreement.”

According to the seven-year-old release, Zync’s creative team would “remain intact and work alongside Round Hill’s sync staff.” Also included in the multifaceted union was a publishing JV designed to “offer funds for developing and signing new publishing deals with hot emerging artists.” (The precise professional status of those signings is also at issue in the legal battle.)

Zync founder Sanne Hagelsten departed the company in 2019, at which point existing exec Marisa Baldi began as chief creative officer of Round Hill itself, per Zync’s description of the timeline. Nevertheless, the Round Hill-Zync JV was terminated in 2022, according to the latter party.

As explained in the lengthy complaint, that termination coincided with the underlying agreement’s language; Zync was identified on its website as a Round Hill company at the time of writing, however.

Moving beyond this complex history, it goes without saying that the situation has proven far from ideal in the eyes of Zync, which is specifically suing the Round Hill Music Royalty Fund II.

The complaint describes in detail the alleged “bullying and mistreatment” from Round Hill “senior leadership” against Zync. In the interest of relative brevity, the legal text also lays out in many more words an essentially even split between Zync and Round Hill under the convoluted JV, including sharing certain personnel costs, some overhead bills, and a portion of revenue.

Zync was particularly to pursue deals involving (and receive related commissions for) Round Hill’s own IP, including the Carlin Music catalog, in the sync space. However, “it became immediately apparent to Baldi and to Hagelsten that key members of Round Hill’s leadership were rude, dismissive, and oppressive,” the plaintiffs maintain in the filing.

An alleged failure to provide access to its proprietary software, on top of alleged records disorganization that prevented Zync from knowing exactly which song rights were involved, significantly hindered the union and the sync results out of the gate, the text relays.

And predictably, given these alleged shortcomings, issues also plagued the expense-sharing side of the pact, according to Zync’s lawsuit. The resulting hard feelings set the stage for the aforementioned exit of Hagelsten, who’d allegedly faced “disdain and contempt” from Round Hill employees, “making her feel unwelcome to continue with the company.”

Lastly, in terms of the suit’s details, this evidently rocky relationship between Zync and Round Hill laid the groundwork for a grand finale of sorts under their agreement. As described by the complaint, one clause meant that Round Hill was at the deal’s conclusion “obligated to buy Zync’s interests in,” among other things, the appropriate copyrights, trademark, web address, and more.

The value of the copyrights and talent agreements under the deal was to be determined by an independent third-party appraiser, the suit shows. Though things seemingly continued as normal (sans a written pact) even after the contract expired in 2022, the final straw was evidently when Round Hill allegedly gave Baldi the boot in April of 2023.

Thus, Zync (Prager Metis) and Round Hill (Alderbrook Companies) promptly enlisted separate appraisers to determine the purchase price. Unsurprisingly, the parties and their firms proved unable to come to an agreement, with Zync rather directly criticizing Alderbrook’s “indefensibly low” price.

Round Hill is allegedly seeking sizable expense deductions from the cost for Zync’s purported failure to hit certain sync-revenue benchmarks, among other things. All told, Zync is suing on eight counts (breach of contract, unjust enrichment, and more) and pushing for millions in damages.

“Round Hill Music denies the allegations in the complaint filed today by Zync Music Group,” Round Hill told Digital Music News. “The dispute between Round Hill and Zync Music Group is a commercial dispute over the valuation of their joint venture partnership which is going through a dissolution and subject to an appraisal process. The specious and salacious allegations of the complaint are being used by Zync as a substitute for the failing merits of its case.”