The members of rock band Lit have reached a settlement to end an $800,000 lawsuit against Sony Music over streaming royalties for their ’90s catalog.
A Tuesday (July 7) court filing, first obtained and reported by Billboard, says Sony has agreed on a “settlement in principle” with Lit frontman A. Jay Popoff, guitarist Jeremy Popoff, bassist Kevin Baldes and the estate of late drummer Allen Shellenberger. The band is best known for the hit 1999 single “My Own Worst Enemy,” which spent 11 weeks at No. 1 on Billboard’s Alternative Airplay chart and has more than 500 million streams on Spotify.
A written settlement agreement is currently in the process of being finalized. The terms of the deal have not been disclosed, and reps for Lit and Sony did not immediately return requests for comment on the resolution.
The members of Lit sued Sony in March, seeking a greater share of their streaming royalties. The major music company, whose subsidiary RCA Records signed Lit in 1998, had up until then been paying the musicians a basic 14% U.S. recorded royalty rate for plays on Spotify and other digital streamers.
However, Lit argued it was entitled to more because of a clause in the band’s 1998 record deal with RCA that allocates the band 50% of net proceeds from master use licenses of its music. In a parenthetical, the contract says an example of this would be “RCA’s license to another person of the right to embody a master recording on a website in a so-called ‘streaming’ format, which is not subject to the ‘digital download’ of that master recording by a viewer.”
It’s not clear how this clause made it into Lit’s record deal, since music streaming was still in its most nascent stage in 1998; MP3s were only invented in 1993, and the first mainstream streaming platforms like PressPlay and Rhapsody didn’t launch until the early 2000s. Even Napster, which hosted music downloading rather than streaming, didn’t arrive until 1999.
Lit’s members claimed that this anomalous contract language entitled them to $800,000 in allegedly underpaid streaming royalties. According to the lawsuit, the band tried to negotiate a more favorable split before going to court, but Sony offered “a half-hearted defense” of the traditional royalty rate and then stopped responding entirely.
In May, a lawyer for Sony said in a court filing that the band “commenced settlement discussions” after the lawsuit was filed. A judge closed the case following notification of the deal on Tuesday.
