The legal wrangling stems from a 2014 suit by 19 Recordings, which claimed that Sony used dubious accounting methods to cut corners on what it owed Idol stars. Specific issues included the handling of Spotify contracts, television ad deductions, and something called “bonus royalty escalators,” which sounds like an elite conveyance reserved for the Duke of Northumberland, but actually has to do with iTunes transactions.
The judge rejected parts of 19 Recordings’ suit, but not others. forcing Sony to answer the remaining claims. It did so with gusto, claiming that Kelly Clarkson’s album Breakaway did not sell 15 million copies and that “Since U Been Gone” hasn’t actually been certified “multi-platinum” by the RIAA. (This is despite a Wikipedia page declaring the track’s platinum status, which makes it an incontrovertible fact of the Internet.)
Sony alleges that it has overpaid the Idol stars in three ways. First, Sony claims it overpaid royalty rates for tracks featured on compilation albums, which, if the impulse bins of compact discs at Walmart are any indication, have no monetary value whatsoever. Second, Sony asserts it overpaid the royalties on digital downloads for singles by Clay Aiken, Kelly Clarkson, and Carrie Underwood. Finally, Sony says it overpaid for an advance to Kellie Pickler, a sixth-place finisher on Idol.
19 Recordings has yet to respond to the allegations, and Sony has not clarified how it could continue to function in the music business with neither an understanding of how royalties work nor a basic grasp of its digital revenue model.
