Eminem wins royalties case on appeal against UMG

Posted Sep 3, 2010 6:54 PM By  

Eminem

Eminem has won his lawsuit against Aftermath/Universal Music Group on appeal. On Friday, a U.S. Court of Appeals in Pasadena, Calif. ruled that UMG owed the rapper royalties from iTunes downloads and ringtones.

The decision overturned a March 2009 jury trial that ruled in favor of Aftermath and UMG, according to The Wrap.

At question was if royalty rate agreed upon under the term “masters licensed” also applied to downloads and master ringtones as it did to records sold, per the contract. Last March, the court ruled that it did not. On Friday,  the Appeals Court ruled with Eminem, writing, “ On appeal, F.B.T. reasserts that the Masters Licensed provision unambiguously applies to permanent downloads and master-tones. We agree that the contracts are unambiguous and that the district court should have granted summary judgment to F.B.T. We therefore reverse the judgment and vacate the district court’s orders awarding Aftermath its attorneys’ fees.” (The attorneys’ fees were $2.4 million, according to court papers.)

F.B.T. is the company that originally signed Eminem in 1995, before transferring those services to Dr. Dre’s Aftermath, which became part of UMG.

The Wrap also posted the court decision, which we’ve tried to chunnel through, but the upshot is that the district court believed there was sufficient evidence to consider the wording in the contract to be ambiguous when it came to royalties paid for downloads vs. records sold. The Appeals Count found the F.B.T.’s definitions used in the contract “broad,” but not ambiguous.

The papers only reverse the district court decision and do not say how much F.B.T. is owed in royalties, although The Wrap reports that F.B.T. won close to $160,000 from UMG in a separate claim over the accounting errors by the UMG.