Modular, UMA sued by global rights company BMG over withheld Tame Impala royalties

UPDATE:In a statement issued to TMN,Universal Music Australia has responded to claims made by BMG in a New York court that UMA and Modular Recordings withheld royalty payments from Tame Impala. Read the statement below:

Universal Music Australia is aware of media reports concerning a legal claim filed against Mr Pavlovic and certain companies, including Universal Music Australia and Modular Recordings.

No documents relating to the legal claim have been served on Universal Music Australia or Modular Recordings. It is unfortunate that Universal Music Australia and Modular Recordings were not contacted by BMG about the allegations before the case was filed. Had they been contacted, BMG would have realised that the companies should not have been named in the legal claim.

Universal Music Australia and Modular Recordings totally reject the claim made by BMG that they are in any way liable for unpaid mechanical royalties relating to the band Tame Impala. Universal Music Australia and Modular Recordings were not involved in contracting with BMG over mechanicals for sales of Tame Impala recordings in the United States.

A totally separate US registered company – owned and operated by Mr Pavlovic – is responsible for contracting with BMG and for any mechanicals liability. Mr Pavlovic, who is no longer employed by Modular Recordings, has confirmed that this matter has nothing to do with Universal Music Australia or Modular Recordings in Australia.

Universal Music Australia and Modular Recordings are confident that the claim against them is baseless and will be withdrawn or dismissed by the Court.

Following recent comments made by Tame Impala frontman Kevin Parker during a Reddit AMA, which hinted that the band had been short changed for royalties, papers have been filed in New York by global music rights management company BMG.

According to The Australian,BMG, which looks after the catalogues of Chuck Berry, The Kinks and Iggy Pop, is suing 14 defendants including Modular Recordings’ founder Stephen Pavlovic and his label’s co-owner Universal Music Australia, as well as Universal Music Group and Universal Group.

In a suit filed with the New York Southern District Court on May 8, BMG is suing over withheld international royalties of up to US$450,000 (approx AU$590,000) and for ignoring a cease and desist letter which requested the defendants stop selling Tame Impala’s back catalogue. The Australian reports that Modular has owned a mechanical licence to the WA band’s tracks since March 2014, but it violated BMG's intellectual-property rights when it failed to make royalty payments within a 45-day timeframe each quarter.

The court filing states that the case will be heard by New York county judge Edgardo Ramos and that BMG will be represented by patent litigation and intellectual property attorneys Jonathan S. Pink, Peter T. Shapiro and Elior Daniel Shiloh.

The suit follows Kevin Parker’s live chat with fans via Reddit’s Ask Me Anything series, where he said the only money he has made outside of Australia came out of a synchronisation spot when mobile brand Blackberry used Tame Impala’s track Elephant for a US commercial.

“Someone high up spent the money before it got to me. I may never get that money,” Parker said in the AMA. “Then Blackberry and some tequila brand or something put my song in an ad. Then I bought a house and set up a studio. I know what you’re thinking… “wait so…when I bought an album I was helping some businessman pay for his mansion on an island somewhere, and when some dude bought a mobile phone he was helping to pay an artist? WHHHYY?” I’ll tell you why, IT’S MONEY. It doesn’t always go where you want it to go. It’s like a shopping trolley with a bung wheel.”

Parker is the sole songwriter for Tame Impala and inked an exclusive songwriting agreement with BMG in February 2012.

TMN reached out to Tame Impala, Parker's label Spinning Top and Universal Music Australia for comment. All threehave declined to comment.