On October 8th, Limp Bizkit filed a lawsuit against Universal Music Group (UMG) for $200 million over alleged unpaid royalties. Lead singer Fred Durst’s lawyers claim that he has “not seen a dime in royalties” over the decades. This is shocking considering how pervasive the band’s music was in the late 1990s and early 2000s.
The band believes the label’s unfair practices may have affected hundreds of other artists.
The lawsuit was filed with the Los Angeles federal court, alleging that UMG used a “systemic” and “fraudulent” policy that was “deliberately designed” to keep royalties from artists. “UMG’s creation of such a system, while holding itself out as a company that prides itself on investing in and protecting its artists, makes plaintiffs’ discovery of UMG’s scheme all the more appalling and unsettling,” Durst’s lawyers explain. “Possibly hundreds of other artists” may have; “unfairly had their royalties wrongfully withheld for years.”
Durst has repeatedly made the claim that Limp Bizkit has “never received any royalties from UMG.” Despite the band selling millions of albums and having “millions of streaming users per month on Spotify alone.”
How?
The suit claims that UMG withheld these earnings due to the band being unrecouped. Basically, Limp Bizkit hadn’t made back more money than the label had paid in upfront advances.
“Durst explained that he had been informed by UMG that he had not received any royalty statements because UMG told him over the years that it was not required to provide them since his account was still so far from recoupment,” said his lawyer. “Durst’s representatives, suspicious that UMG was wrongfully claiming Plaintiffs’ accounts were unrecouped, suggested investigating further.”
When these representatives contacted UMG about the situation, they found out Limp Bizkit’s accounts held over $1 million in royalties. However, the label “failed to alert” the band about the money. This raised more suspicion about the legalities of “UMG’s accounting and payment practices.”
Limp Bizkit’s Claim
“UMG’s failure to issue royalty statements in particular from 1997-2004 — the height of the band’s fame and during periods in which they made record-breaking sales — with respect to its most popular albums suggests that UMG was intentionally concealing the true amount of sales, and therefore royalties, due and owing to Limp Bizkit in order to unfairly keep those profits for itself,” the lawsuit states.
Adding, “Given that Limp Bizkit’s first three albums had already sold several million copies by the early 2000s, the recording funds and costs should have been quickly recouped, and UMG should have started paying royalties on those albums right away — not over twenty years later.”
Limp Bizkit believes that UMG used “fraudulent accounting practices” to intentionally keep the band in debt to avoid shelling out royalties. Potentially, including completely fictitious charges to the rap-rock band’s accounts.
“But where did this additional $199,676.00 charged to the account come from?” Durst’s lawyers write. “It seems to have come out of thin air to overdraft Limp Bizkit’s due and payable account in order to defraud Limp Bizkit and show an unrecouped account.”
UMG’s Reaction
According to the lawsuit, these issues were brought up with UMG directly. The label supposedly argued that Limp Bizkit had been paid $43 million in recoupable advances over the years. So it took 20+ years for them to repay those debts. UMG recently released $1.03 million to the band and $2.3 million to Durst’s Flawless Records. However, the band claims they are owed far more than that.
“Given the vast amounts of money collected by UMG in relation to sales of Limp Bizkit’s and Flawless Records’ albums over the years … UMG is liable to plaintiffs for tens of millions of dollars in copyright infringement, if not more,” the filing reads. “Indeed, Plaintiffs allege that the amounts owed to them by UMG following the rescission of these agreements will easily surpass $200 million.”
However, this goes beyond just unpaid royalties. They are also seeking to void the band’s contract with UMG along with copyright damages.
We’ll keep you posted on this lawsuit as it develops. Because if Limp Bizkit’s claims are even remotely true, more artists suing will surely follow.
