Posted by Glen Sears | April 11, 2016 10:02 am | No Comments
Story of the Week
Sony Music Files Fraud Lawsuit Against Rdio Executives Over Pandora Deal
In a new lawsuit, Sony Music alleges it was defrauded of millions when the on-demand service Rdio came to agreement with Pandora and subsequently filed for Chapter 11 bankruptcy last November.
The complaint states: “Unbeknownst to SME, at the same time that Rdio was negotiating the amendment to its Content Agreement with SME, it was simultaneously negotiating its deal with Pandora — under which Rdio would file for bankruptcy; Pandora would buy Rdio’s assets out of bankruptcy; defendant Bay (as part-owner, executive officer, and director of Rdio’s secured creditor) would expect to be first in line to receive proceeds of the Pandora deal; and SME (as an unsecured creditor) would receive pennies on the dollar for the amounts owed to it under the amended Content Agreement.”
Sony says that Rdio purposely kept its Pandora negotiations and impending bankruptcy secret so as to hold back Sony from demanding immediate payment of the $5.5 million and “inducing” extensions and a restructuring of payment obligations.
Read more on Billboard.
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