On October 8, 2024, the frontman of the nu-metal band Limp Bizkit, Fred Durst filed a lawsuit in the Los Angeles federal court against Universal Music Group (UMG) alleging that the music corporation held back royalties worth millions from him and the band members. The lawsuit which is worth $200 million described the royalty discrepancy as fraudulent accounting practices.
Reportedly, the lawsuit now seeks royalties for around 45 million albums sold in the 1990s and early 2000s. According to Lambgoat, Fred Durst’s lawsuit claims that Limp Bizkit’s record deal with UMG required advances to be recouped through album sales before royalties were paid. Allegedly, UMG reported that $43 million in costs remained unrecovered, resulting in no royalty payments to Fred Durst.
However, on November 22, 2024, UMG filed a motion in the court saying that the lawsuit came out of a fallacy. It claimed they contacted the band’s manager to establish a vendor profile to execute the payments. The manager initially stated most band members had sold their royalty shares, later clarifying this applied to publishing royalties, not recordings. The company stated,
“In other words, Plaintiffs’ entire narrative that UMG tried to conceal royalties is a fiction.”
UMG reportedly stated it paid $3.4 million to Limp Bizkit and associated entities in August 2024 after corrections from the band’s business manager. This payment reportedly covered back royalties and profits. Fred Durst’s lawyer criticized UMG for employing standard legal tactics to dismiss the case, accusing the label of avoiding responsibility.
Universal Music Group argued these communications undermined fraud allegations and reported paying Fred Durst over $1 million in back royalties, and $2.3 million to his record label, covering all outstanding payments.
Universal Music Group allegedly wanted Fred Durst’s lawsuit to be dismissed with ‘prejudice’
In its motion, the music corporation not only wrote that the lawsuit was based on fallacy but also pleaded to dismiss it with prejudice. UMG, in their response, stated Limp Bizkit served them a rescission notice on September 30, 2024, attempting to terminate agreements.
Universal Music Group rejected this, leading to the current lawsuit alleging multiple claims, including breach of contract and fraud. The suit also seeks compensation for other artists under Durst's Flawless Records and demands the return of copyrights held by UMG on those artists' works.
Nevertheless, the original lawsuit alleged Universal Music Group's royalty software has a systemic issue potentially impacting many artists by wrongfully withholding royalties.
It criticized Universal Music Group for presenting itself as a champion of artists while operating such a flawed system, calling the revelation both disturbing and unacceptable. According to The Guardian, Fred Durst's legal team claimed that the pre-trial discovery process would reveal a pattern of fraudulent royalty practices affecting potentially hundreds of artists, suggesting intentional system design flaws.
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Music consultant Jay Gilbert, a former UMG and Warner executive, doubted the accusations, calling it more likely an accounting issue rather than a systematic fraud scheme. Gilbert noted the allegations sounded severe but believed the situation might be less dramatic.
Mark Tavern, a senior executive in the industry, described the lawsuit as an extreme measure likely intended to pressure a quick settlement. He suggested the issue might stem from bureaucracy, incompetence, or the complexities of handling large-scale payments at a firm like the Universal Music Group.
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