Former Eminem Producers Loses Royalty Lawsuit

AllHipHop Staff

Producers affiliated with rapper Eminem’s former production company, F.B.T. Productions LLC, were handed a unanimous defeat Friday (March 2) in its royalty lawsuit against Universal Music Group (UMG).

According to The Associated Press, a federal jury unanimously voted in favor of Universal and other defendants such as rapper/producer Dr. Dre’s Aftermath Records and its distributor, UMG’s Interscope Records.

Richard Busch, F.B.T’s attorney, weighed in on the defeat as he mentioned that the company’s owners, Mark and Jeff Bass, were considering all options, including appeal.

"We're very disappointed by the decision," he told the AP.

The Bass brothers are best known for discovering Eminem and signing the rapper to an exclusive recording deal in 1995. The rapper eventually signed to Aftermath in 1998.

Friday’s verdict is the latest development regarding F.B.T.’ s lawsuit, which the company filed in order to receive a greater share of revenue generated from digital downloads of music made by Eminem between 2003 and 2008.

A distinct difference between digital music and the sale of traditional CD emerged as the main source of conflict in the suit, according to F.B.T.

When it comes to income generated by sales, artists are paid on a royalty structure for traditional CD sales.

The entertainers receive about 16 cents when their CD is sold at retail stores such as Wal-Mart, while a music publisher collects 9.1 cents.

With the suit, F.B.T. sought to have digital sales from services such as iTunes be treated under a master recording licensing deal between Universal and Apple.

The result would have enabled F.B.T. to acquire its share of a 50-50 split with Universal.

Eminem would have factored into the situation, as part of the 50 percent would have been split with him.

Universal instead paid F.B.T and Eminem 12 percent of the album sales, which is the agreed upon rate for physical album sales.

Lawyers for Universal countered F.B.T’s claims as they stated that no difference existed between a digital album sale and a physical album sale.

With that, Universal asserted that its royalty rate was correct and as a result, digital sales shouLd be handled the same way as physical sales.

The difference between the rates could have brought about $1.3 million more for F.B.T. and, according to Busch, furthered the possibility of Eminem suing for a bigger share of the sales himself.

A Universal spokesman expressed how “pleased” the label was with the verdict handed down by the jury, which included Universal’s acknowledgement of an accounting mistake and its agreement to pay about $159,000 to F.B.T.