A US federal court has handed Universal Music Group (UMG) a partial victory in a closely-watched lawsuit brought by Limp Bizkit and its frontman Fred Durst.
In a ruling on Friday (January 17), the US District Court for the Central District of California dismissed parts of the lawsuit that asked the court to nullify three contracts signed in the 1990s and 2000 between Limp Bizkit members, Durst’s label Flawless Records and UMG’s Interscope label.
It also dismissed Limp Bizkit’s copyright infringement claims against UMG.
To nullify the contracts would require “a total failure of performance” on the part of UMG in carrying out those contracts; UMG’s delayed payment of some royalties owed to Limp Bizkit and Flawless Records doesn’t meet that standard, not least because Interscope “paid millions” in advances to Limp Bizkit and invested substantial amounts into their music, Judge Percy Anderson wrote in his order, which can be read in full here.
Judge Anderson concluded that because the contracts are still valid, there is no reason to rule that UMG violated Limp Bizkit or Flawless Records’ copyrights.
The copyright claims are what would have given the US federal court jurisdiction over the matter, as copyright is a matter of federal law. The other allegations against UMG – breach of contract, breach of fiduciary duty, fraudulent concealment, promissory fraud, and other charges – are matters of state law.
Without the copyright claims, the federal court doesn’t have jurisdiction to hear the case. Judge Anderson gave Limp Bizkit’s lawyers until February 3 to amend the complaint to include copyright claims, otherwise, he wrote, he will dismiss the rest of the case.
However, Limp Bizkit could still pursue the remaining allegations in a state court.
Durst, Limp Bizkit, and Flawless Records brought the case against UMG last October, asking for $200 million over allegations that UMG had failed to pay royalties to Durst and Limp Bizkit, despite the band having sold more than 45 million records since it signed in the 1990s with California indie Flip Records, with distribution from UMG’s Interscope.
The lawsuit asked the federal court for “rescission” (i.e., nullification) of the contracts between Interscope, Flawless, and Limp Bizkit, as well as compensation for other artists who worked with UMG through Flawless Records.
Among other claims, Durst’s lawyers alleged that UMG had “designed and implemented royalty software and systems that were deliberately designed to conceal artists’ (including Plaintiffs’) royalties and keep those profits for itself,” adding that this may have affected “possibly hundreds of other artists who have unfairly had their royalties wrongfully withheld for years.”
According to the complaint, in April 2024, a business manager for Limp Bizkit contacted UMG, alleging that Durst and the other band members hadn’t been paid royalties, and asked for access to UMG’s portal to view royalty statements. The manager found a little over $1 million in unpaid royalties to the band, and only after that did UMG request payment info for the band members and transfer the money to them, along with some $2.4 million owed to Flawless Records.
In a motion to dismiss the case, filed last November, UMG disputed that claim, asserting that an exec in the Royalties Department had reached out to the business manager a year earlier and advised him of the need to “set up a vendor profile for Limp Bizkit” so that the company could “start making royalty payments” to the band.
UMG argued that this “eviscerates [the] claim” that it had kept silent about Limp Bizkit’s royalties until after the business manager began looking into the matter.Music Business Worldwide
