E! Online article on the Warner/Maverick Issue
Warner Music Group, currently at odds with Madge’s so-called “vanity label” Maverick Records, claims Maverick has lost $66 million since 1999, according to court documents filed by Warner.
Created 12 years ago as a joint venture between the pop diva and Warner Music, Maverick’s partnership agreement with the music company expires this year.
After talks over the label’s future at Warner failed, Madonna and business partners Guy Oseary and Ronnie Dashev recently filed a court order to terminate the relationship.
But there’s a price to be paid for the parting, according to the Hollywood Reporter. In its lawsuit, Warner Music insists Maverick would have to shell out $92.5 million for the breakup, plus the value of Warner’s interest in the label, which counts Alanis Morissette and Michelle Branch among its artists.
An itemized receipt shows $66 million in losses, a $20 million loan, and $6.5 million in unrecouped fees.
That’s not the way Maverick sees it. Last month, Madonna’s label sued Warner Music and its former parent company Time Warner Inc. for $200 million, claiming breach of contract and fraud.
Both sides have been at odds over the Maverick‘s value for months with the label estimating its own worth at $60 million. Its court papers show sales of over $900 million generated for Warner with $100 million of that profit not adequately accounted for.
However, Warner’s lawsuit, filed in Delaware last month, claimed that Maverick hadn’t made a dime in six years and asked a judge to find that the company fulfilled its duties to Maverick and that any claims that suggested otherwise were groundless.
But the multimedia maven is also expected to go after Warner, owned since November by an investor group led by Edgar Bronfman Jr., over the value of her stock options. Valued at $20 million to $25 million in 1999 as part of her recording contract, the stock’s value has tanked since a 2001 merger between Time Warner and AOL.
While Warner execs say the stock options were never guaranteed, Madonna, unlike some hapless shareholder, is expected to seek at least $20 million in compensation.
A call Wednesday to Madonna’s rep was not immediately returned.
Meanwhile, the material mother of two is busy doing what she does best. She plans to hit the road again, kicking off her Re-Invention Tour on May 24 in Los Angeles. The trek, in support of her latest disc, American Life, will play dates in North America before heading over to Europe and Israel.
Article by Lia Haberman
Source: E! Online