Published Mar 16, 2012It's been almost a decade since the iTunes Store opened and legal downloading began on a large scale, but major labels still seem to be struggling with how to properly compensate artists for digital sales. Now, soul legends the Temptations have filed a class-action lawsuit against Universal Music Group over unpaid royalties stemming from downloads and ringtones.
Much like previous lawsuits from Rick James's estate and Eminem collaborators FBT Productions, Temptations members Otis Williams and Ron Tyson are claiming that digital downloads should be considered licensing agreements rather than outright sales. The group's licensing agreement means that they're entitled to 50 percent of profits, compared to 14 to 16 percent of sales earnings.
Billboard reports that the Temptations members, who filed their suit in federal court in California, are seeking millions of dollars in revenue. Not only do they want iTunes royalties, they're also seeking profits from other legal download providers like Amazon, Napster, Rhapsody, Zune and eMusic, plus ringtone sellers like AT&T, Verizon, Sprint and T-Mobile (there is doubtless many a dude who has programmed his phone to play "My Girl" every time his girlfriend calls).
The lawsuit cites the 2009 suit from FBT Productions. The producers sued Universal over the same issue and, despite losing the initial case, won an appeal. We knew that the lawsuit could have massive financial implications for record labels, and now it appears we're starting to see that come to fruition.