Beatles, EMI to squabble again
By Jim Welte - MP3.com
Judge allows the latest lawsuit in a three-decade legal battle to proceed, with the Fab Four's recording company claiming that the label giant owes them millions.
When Apple Corps, the Beatles record company, gets involved in a lawsuit, it has a tendency to last a while, even 30 years after the band's demise.
Just like the Fab Four's three-decade legal battle with Apple Computer over the use of the apple logo, Apple Corps' legal action against label giant and affiliate label Capitol Records continues 27 years after it began.
New York State Supreme Court Justice Karla Moskowitz yesterday denied EMI's request to have Apple Corps' lawsuit for fraud and breach of contract thrown out. In its complaint, the Beatles and Apple Corps seek $25 million in addition to two prior EMI settlement payments, one of which was for $35 million, and also hope to reclaim rights to all the master recordings by the band.
In the original 1979 lawsuit, Apple Corps claimed that EMI and Capitol had underpaid the band by more than $20 million. A settlement was reached in 1989, giving the band and Apple increased royalty rates and requiring EMI and Capitol to follow more stringent auditing requirements.
Apple Corps claims that a recent audit uncovered additional fraud, triggering the filing of the latest lawsuit last December.
The Beatles, including the estates of the late George Harrison and John Lennon's widow Yoko Ono, claimed that EMI and Capitol wrongly classified copies of Beatles recordings as destroyed or damaged and secretly sold them for more than $19 million, retaining the proceeds.
EMI had sought to have the case thrown out because a fiduciary relationship no longer exists between the company and the band. Moskowitz denied that request, according to Law.com.
"Because of the allegation plaintiffs make here and the [original] decision, I cannot hold, as a matter of law, that the parties no longer have a fiduciary relationship," Moskowitz ruled. "[P]laintiff has pled a viable, continuing fiduciary relationship. Whether or not the level of contentiousness and distrust was so great as to destroy the fiduciary relationship the parties had is an issue that must await development of the factual record."
