Universal Music Group Files Motion to Dismiss Class Action Suit Over 2008 Fire
UPDATE: The judge overseeing the class action lawsuit over alleged damages in a 2008 Universal Music vault fire has denied UMG’s motion to stay discovery in the case, according to court documents obtained by Rolling Stone. The ruling means UMG will have to turn over a trove of documents, including lists of recordings the label claimed it lost in previous litigation and insurance filings related to the fire. Despite this decision, Judge John A. Kronstadt has yet to rule on UMG’s motion to dismiss the lawsuit.
“We are grateful that the Court has ordered that UMG’s veil of secrecy be lifted,” said Howard King, one of the attorneys for the artists who filed the class action suit. “We are hopeful of now learning the truth about how many master recordings UMG claimed were destroyed when it was a plaintiff and how many master recordings it claims were actually destroyed now that it is a defendant.”
Representatives for UMG did not immediately return Rolling Stone‘s request for comment.
Universal Music Group filed a motion to dismiss a class action lawsuit filed by Soundgarden, Tom Petty’s ex-wife Jane, Hole, Steve Earle and the estate of Tupac Shakur on behalf of artists who are seeking damages related to a 2008 fire that allegedly destroyed over 500,000 recordings.
The class action lawsuit was filed in late June and accuses Universal Music of negligence in not doing enough to prevent the fire, as well as concealing the extent of the destruction from artists while simultaneously pursuing litigation and insurance claims to recoup losses. The suit claims that Universal took in settlement proceeds and insurance claims valued at $150 million, and the class is seeking damages worth half that, plus half of any additional losses.
In its motion to dismiss, UMG, which is being represented by the law firm Gibson, Dunn & Crutcher, claimed that they have full ownership over any master tapes that were allegedly lost in the fire and denied they have any obligation to split the insurance and settlement proceeds with the artists. The label also argued that, because they are the sole owners of those masters, they did not violate any good faith term in their contracts with artists to keep those recordings safe for the mutual benefit of musician and label. UMG also argues that breach of contract claims have exceeded the time limit in regards to statute of limitations for filing such claims.
Howard King, one of the attorneys leading the class action lawsuit, tells Rolling Stone that UMG’s position “is the same as Donald Trump during his campaign — that he could shoot someone on 5th Avenue with impunity. And they think they can set fire to those master recordings on 5th Avenue with impunity.”
In a statement, King added that he was “optimistic” that the artists he represented could beat the motion to dismiss, or at least amend any potential defects in the initial lawsuit that the judge might find.
While the UMG warehouse fire was widely covered in 2008, UMG downplayed the damage at the time, telling media outlets that the losses only included “a small number of tapes and other material by obscure artists from the 1940s and Fifties.” The potential extent of the damages was not well known until The New York Times Magazine published a story in June that alleged over half-a-million recordings, including irreplaceable master tapes and troves of unreleased recordings, had been lost.
Since the report, UMG has continued to dispute the extent of the damage, though CEO Lucian Grainge told employees in a memo to be transparent with any artist asking about the state of their recordings. Since then, UMG’s chief archivist, Pat Kraus, has been leading an initiative to process requests from artists, and on Wednesday — prior to the filing of the motion to dismiss — Kraus issued an internal memo that included fairly promising numbers.
In the memo, Kraus claimed that his UMG team had fielded requests from about 275 artists and reviewed 26,663 individual assets covering 30 artists. “Of those assets,” Kraus said, “We believe we’ve identified 424 that could be missing or lost due to the fire, with audio assets accounting for 349 of them. Our data suggests that 22 of those could be ‘original masters’ which are associated with 5 artists. For each of those lost masters, we have located high-quality alternate sources in the form safety copies or duplicate masters.”
UMG did not specify which artists or recordings had been covered in the search so far. King, however, did share a list of 118 artists who had been in touch with him since the class action was filed and were also seeking information about recordings that might have been destroyed. The list includes Blink-182, the Eagles, Steely Dan, the Flying Burrito Brothers, Roseanne Cash, T. Bone Burnett, Guns ’N Roses, the Eagles, Bo Diddley, Iggy Pop, Nirvana, Lynyrd Skynyrd, Smash Mouth, Will Smith, Will.i.am, Rob Zombie, White Zombie, Limp Bizkit, Buddy Guy, the Go-Go’s, John Fogerty, Styx, Q-Tip, No Doubt, Huey Lewis and the News, Dashboard Confessional and Peter Frampton.
Of those artists, King says UMG only provided information regarding the status of recordings belonging to one, Hole. King says UMG claimed that no Hole recordings were destroyed in the 2008 fire, but when he and the band asked for proof in the form of documents that would’ve been filed when UMG was pursuing litigation and insurance claims, the label declined to hand them over.