(Bloomberg) -- Fred Durst, frontman of the rock band Limp Bizkit, sued Universal Music Group NV, the world’s largest record company, claiming he was cheated out of millions of dollars in royalties.
The complaint filed Tuesday in federal court in Los Angeles seeks upward of $200 million in damages, as well as the return of Limp Bizkit’s copyrights. The lawsuit alleges Universal Music systematically and intentionally deprived other artists of their earnings as well, and seeks to claw back copyrights from other groups that worked with Universal through Durst’s Flawless Records.
The frontman maintains he never received royalties from Universal, even though Limp Bizkit has sold more than 45 million records and equivalents. The band has become popular again in the streaming era. So far this year, the complaint alleges, Limp Bizkit has generated over 450 million streams and will likely exceed 793 million by the end of the year.
According to the complaint, Durst and his bandmates received funding advances on albums while they worked on new music. The company also covered recording costs. The group was to receive royalties once Universal Music recovered its expenses.
The company allegedly told Durst representatives that he hadn’t received any royalty statements over the years because Universal Music was “not required to provide them since his account was still so far from recoupment.” Management allegedly told them the company spent approximately $43 million that would need to be recovered before Durst could be paid any royalties.
Durst’s team discovered that Flip Records, the original label that signed the band, has been making millions of dollars through profit-sharing with Universal Music while Durst has received nothing.
When the team logged onto a Universal Music database to view Durst’s royalty statements, they found he had over $1 million in earnings waiting to be paid, the complaint said. After contacting the company, Durst’s representatives were told to provide various data, including banking information. Universal Music officials also blamed an error in new software.
The complaint alleges Universal Music should have had all of that information from past advances and that management never intended to pay any royalties.
Universal Music didn’t respond to a request for comment.
Later, Durst’s team went looking for past royalty statements. They instead found gaps in the reporting, including during the seven years of the band’s peak popularity.
Universal Music’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 complaint said.
At times, royalty reports would show a positive balance owed to Durst, but then subsequent reports would show unrecovered expenses and a negative balance. The lawsuit claims Universal Music fraudulently manipulated the accounts to avoid paying royalties.
Durst’s attorneys suggest that Universal Music’s accounting system is “intentionally designed to deprive” Durst and “potentially hundreds of other artists of their royalties and profits, and keep them in the dark about positive balances in their accounts.”
As evidence, the suit states that Durst's label, Flawless, signed numerous acts, including Puddle of Mudd, and hasn’t received profit-sharing statements since 2008. According to the complaint, Flawless and Universal agreed to share profits from those bands’ earnings. Like Durst’s account statement, some of Flawless’ reports showed a profit for a time before being marked with unrecovered expenses.
Universal Music ultimately paid the artist approximately $1 million in royalties while Flawless Records received about $2.3 million, the filing shows. Durst is now seeking to cancel Universal Music’s contracts with Limp Bizkit and Flawless, citing the company’s alleged failure to provide the proper accounting required under their contracts. If the contracts are voided, Universal Music would be violating their copyrights, the suit said.
The case is Durst v. Universal Music Group, Inc., 2:24-cv-08630, US District Court, Central District of California (Los Angeles).
(Updates with details of case starting in 10th paragraph.)
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