Downtown Music Holdings Subsidiary FUGA Allegedly Defraud Clients for Hundreds Of Thousands Of Dollars
FUGA, which is owned by Downtown Music Holdings, is a global independent rights management and music services company. On the other hand, For Less Digital is a music distribution service that helps independent artists and record labels distribute their music to various streaming platforms and music stores.
However, recently FUGA & Downtown Music Holdings have been under fire for allegedly “defrauding” For Less Digital and hundreds of rights holders by refusing to pay out streaming royalties owed to the company. According to For Less Digital’s Chief Executive Officer Griffen Farrell, “FUGA was hired to collect royalties on For Less Digital’s behalf for its catalog and clients but decided not to pay out the funds after both parties disagreed on how royalties should be paid to For Less Digital clients”.
“They must be stopped, we will stop them,” Farrell says.
“For Less Digital intends to hold Downtown Music Holdings and FUGA responsible for its reprehensible conduct and unfair and deceptive trade practices,”
“We owe it to our clients –– and we owe it to every other artist, song writer, composer and publisher spending hours in the studio, basement or garage fulfilling their dreams while FUGA & Downtown Music Holdings lies in wait to profit off their sweat and tears.
According to FUGA, this decision was made to protect their relationship with digital service providers since FUGA was not satisfied with the type of genre of music For Less Digital was sending to DSPs.
In general, record labels and music distribution services can come under investigation for a variety of reasons. For example, they may be investigated for copyright infringement, antitrust violations, or deceptive business practices. Record labels and distribution services may also be investigated for failure to pay royalties to artists or for breaching contractual agreements with artists or other parties.
Music streaming services pay royalties to rights organizations for the use of copyrighted music on their platforms. These royalties are typically based on a per-stream basis or a percentage of the revenue generated by the service. Disputes over royalties can arise for various reasons, such as disagreements over the amount owed, disputes over the ownership or validity of the music rights, or technical issues with payment processing.
It’s important to note that payment disputes are not uncommon in the music industry. Rights organizations like FUGA often work on behalf of many different artists and rights holders, and collecting and distributing royalties can be a complex process. Furthermore, streaming services like YouTube, Apple Music, and Spotify have to navigate complex licensing agreements and legal requirements in different countries and regions around the world, which can further complicate the payment process.
It’s also worth noting that disputes over royalties and payments can often result in legal action, as rights organizations and individual artists may seek legal recourse if they feel they have not been paid their fair share. Ultimately, it’s up to the courts to decide the outcome of such disputes, based on the evidence presented and the legal precedents applicable to the case.