The war between Madonna and her record label is starting to heat up, as the singer has finally spoken out about Warner Music Group's lawsuit against Maverick Records, the boutique imprint she owns with it in a partnership that's ending this year.
"I find myself in the ludicrous position of being sued by my own record company," Madonna said in a statement, "whom I have been loyal, industrious and reliable to for over 20 years. For them to behave this way is nothing short of treason."
The two record labels filed lawsuits against each other late last month, after negotiations to resolve the ending partnership faltered between Madonna's partners in Maverick and WMG's new chief executive and part owner, Edgar Bronfman Jr. At the heart of the dispute was the value of the 60 percent share Madonna and her partners Guy Oseary and Ronnie Dashev co-owned, and whether Warner would buy out that share when its agreement with Maverick runs out on December 31.
But on March 24, Warner Music filed a "preemptive" suit in Delaware, asking the court to affirm that it had not breached its contract with Maverick and that it has no further obligation to the label. In the complaint, WMG claims that Maverick has amassed $66 million in loses since 1999. The suit also reveals that WMG expects to be paid $92.5 million before Maverick would be able to make an offer for WMG's 40 percent share of the joint venture — the alleged losses plus repayment of a $20 million loan plus a $6.5 million "special fee."
The next day, Maverick filed a lawsuit in Los Angeles Superior Court against WMG, claiming that the record label group failed to keep up its end of the joint venture due to fraud and improper accounting. Maverick, which is home to such artists as Alanis Morissette and Michelle Branch, claimed that WMG "repeatedly and willfully" breached its 1992 joint-venture pact, manipulating figures to show that Maverick was losing money by not crediting it with the profits generated by the manufacture, distribution and international sales of Maverick releases, which they estimate are in the realm of $100 million. The suit alleges the label had to spend $30 million in promotion, publicity, new media, sales and marketing expenses — which WMG was required to pay under the pact. The suit also charges that Warner coerced them to settle a lawsuit with Branch to keep her manager happy, since the manager represents other Warner Music artists.
In addition to damages to be determined, though it's estimated to be more than $200 million, the suit also seeks a declaration that the label has the right to terminate the joint venture.
Madonna, who is preparing for her world tour, owes two more albums to Warner Bros. Records. Meanwhile, Morissette's new album, So-Called Chaos, is due in May.
The next court date in the case is May 7, when a Delaware judge will hear a motion to stay Warner's action to allow the California complaint to proceed.