Pop star goes to court over contract dispute: George Michael seeking 'divorce' from Sony record company deal

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The Independent Online
A MULTI-MILLION pound legal battle which could reshape the future of the music industry begins in the High Court this week.

George Michael, one of the world's biggest pop stars, takes on his record company Sony, one of the world's biggest electronics firms, alleging his recording contract is so restrictive that it is unworkable and that Sony is dictating and constricting his career.

If he succeeds in 'divorcing' Sony Music Entertainments UK Ltd in this fashion, then the case could see the ripping up of other major stars' contracts - and with that goes the bedrock finance upon which record companies depend.

But whatever the outcome of the case, expected to last about eight weeks, it promises the public unprecedented scrutiny of the music industry and the way record companies sign up their artists.

Mr Michael - who sprang to fame 11 years ago as half of the pop duo Wham] - is alleging restraint of trade over a 15-year contract binding him to an album a year for Sony until 2003. For example, in his 30-page writ, the singer-songwriter alleges Sony has no specific obligation to promote or release his work, while it makes about twice as much from each sale.

For the first time in a case like this, lawyers for Mr Michael will also cite European law, article 85 of the Treaty of Rome, which prohibits agreements afecting trade between member states. At present if Sony chooses not to release Mr Michael's work in for example, France, he is forbidden to record for another company that will.

But according to Ian McKane, a music industry lawyer, one of the biggest prizes at stake in the case is the lucrative copyright and the back catalogue of Mr Michael's works currently held by Sony. If the contract fails, an issue then arises as to who retains the copyright. Mr Michael will argue that as the money for recording costs, packaging and some promotion is recovered from his royalties, he should retain the copyright to his own work.

Sony Music, whose contracts are not dissimilar from other music labels, is expected fiercely to contest the claim. It has said it has a 'clear and unwavering commitment' to Mr Michael, and is 'saddened and surprised' by the action.

Central to Sony's defence is likely to be the element of risk in advances, which are sometimes enormous, to musicians. If an act does not succeed, the record company bears all the costs. Music labels have been known to lose up to pounds 500,000 on a failed new act. They rely on the profits from their big name stars in order to invest and risk in new bands or singers.

(Photograph omitted)