Beatles sue EMI for £30m of royalties 'unpaid' since 1962

[StoneMtn]

Beatles sue EMI for £30m of royalties 'unpaid' since 1962

By Jonathan Brown

Published: 17 December 2005

The Beatles' recording career spanned just seven years. Raking over the embers of the band's business affairs in the world's courtrooms has lasted decades.

Yesterday that long and winding history of legal wrangles took a new turn as it emerged that the surviving members and families of John Lennon and George Harrison were suing the record company EMI, claiming £30m in unpaid royalties.

Apple Records, which represents the interests of Sir Paul McCartney, Ringo Starr and the relatives of Lennon and Harrison, launched the claim simultaneously against EMI Group at the High Court in London and its Capitol Records subsidiary at the Supreme Court in New York. Apple said it had been forced to act after negotiations broke down.

It is seeking backdated royalties covering the band's entire output, dating to 1962, when the Beatles first signed for EMI's Parlophone label while still performing at the Star Club in Hamburg. The band is claiming that EMI, which owns the copyright to Beatles recordings in perpetuity, failed to honour the terms of its contract with Apple. It said that it had found irregularities after an audit. Apple Corp's chief executive, Neil Aspinall, said: "We have tried to reach a settlement through good faith negotiations and regret that our efforts have been in vain. Despite very clear provisions in our contracts, EMI persist in ignoring their obligations and duty to account fairly and with transparency."

An EMI spokeswoman tried to play down the dispute. "Artists do sometimes request an audit of their record label's accounts, that's not unusual, but sometimes there are differences of opinion, especially when the contracts are large and complex, when you can get issues of contractual interpretation. Ninety-nine out of 100 audit problems are resolved by amicable settlements for a small fraction of the claim," she said.

EMI was recently among a number of big music companies, including Universal Music Group, Sony Music, BMG and Warner Music, which were forced to pay out more than $50m (£28m) to artists in unclaimed royalties.

The relationship between Apple and EMI has rarely run smoothly. The Beatles formed Apple in 1968, signing a number of new bands, although EMI retained ownership of the Beatles' music. The two companies slogged it out for a decade over claims that EMI secretly sold or gave away millions of records to retailers.

In 1991 the companies found themselves back in court in a dispute over the release of the Beatles' red and blue albums on CD. A High Court judge ruled in favour of the band, which insisted that it maintained artistic control over its output.

The Beatles' legal shenanigans began during the band's musical lifetime. The initial deal with EMI offered the young musicians a particularly poor share of the royalties. Lennon and McCartney renegotiated the agreement on behalf of Apple, improving their stake. But as the personal and musical relations between the songwriters broke down so they argued about business too.

McCartney blocked the American showbusiness lawyer Allen Klein, appointed by Lennon as manager after the death of Brian Epstein. He favoured the New York legal firm Eastman and Eastman, run by his wife Linda's family.

Litigation dragged on throughout the 1970s when the Beatles were in effect in the hands of a court-appointed official receiver.

It was during this time that the band began its long and still unresolved trademark dispute with the US computer company Apple.

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