Daily 30: Wed 01.07.2015
SAN FRANCISCO (AP) — Rapper Dr. Dre and record producer Jimmy Iovine are being vilified as scam artists in a lawsuit that alleges the duo duped one of their former partners in Beat Electronics before selling the trendy headphone maker to Apple for $3 billion last year.
The complaint filed Tuesday in San Mateo Superior Court accuses Dre and Iovine of double crossing Noel Lee, the founder of video and audio cable maker Monster LLC.
Lee once held a 5 percent stake in Beats as part of a partnership between the headphone maker and Monster that ended in 2012. The lawsuit alleges Dre and Iovine orchestrated a "sham" deal with smartphone maker HTC in 2011 that led to the termination of the Monster alliance.
The suit alleges the shady maneuvering prompted Lee to pare his stake in Beats to 1.25 percent before selling his remaining holdings for $5.5 million in the autumn of 2013 after being assured by Beats executives that there were no plans to sell the company for at least several years.
Beats announced its sale to Apple in May, opening the door for Dre and Iovine to become executives at the iPhone and iPad maker. Had he held on to his 1.25 percent stake, Lee would have received more than $30 million in the Apple deal. His original 5 percent stake would have been worth roughly $150 million.
Both Dre, whose real name is Andre Young, and Iovine, a longtime recording industry executive, reaped the biggest jackpots in the Apple deal, though the precise size of their windfalls hasn't been disclosed.
Lee's lawsuit says Dre and Iovine each owned 15 percent stakes in the early stages of the Beats partnership.
Apple Inc., which now employs Dre and Iovine, declined to comment on the lawsuit. The Cupertino company isn't named in the complaint. Besides Dre and Iovine, the lawsuit targets HTC America Holding Ltd. and Paul Wachter, a Beats investor and board member.
Phone messages seeking comment were left for Dre's attorney and a Beats publicist Tuesday evening.
The bitterness seeping through Lee's lawsuit contradicts how Lee described the ending of the Beats partnership in a late 2013 interview with The Associated Press. At that time, Lee called it an "amicable" parting and said he was paid "very generously" in royalties.
This isn't the first time that a former Beats partner has lashed out at Dre and Iovine in court. David Hyman, who sold his music streaming service MOG to Beats in 2012, is suing the two men for bad faith. That action, filed shortly before the Apple deal was sealed, is unfolding in Los Angeles Superior Court.
Lee appears to be interested in recovering the money that he believes he lost through the alleged misconduct of Dre and Iovine. The lawsuit also depicts Lee as the brains behind the Beats By Dre headphones while casting Dre and Iovine as little more than figureheads. One section of the lawsuit likens Lee to two more famous innovators, Apple co-founder Steve Wozniak and sound-system pioneer Ray Dolby.
Lending significant credence to the contention that St. Louis County prosecutor Bob McCulloch mishandled the Darren Wilson grand jury, a member of the jury has filed a lawsuit through the ACLU to be allowed to publicly discuss the case, claiming that McCulloch was wrong when he implied all 12 jurors didn’t think there was enough evidence to charge Wilson.
As a member of the grand jury, the unidentified plaintiff wants to be able to speak about the case but can’t because the grand jury members are subject to a lifetime gag order. The lawsuit is a major development because up to this point the nation had to rely only on the explanation offered by McCulloch without being able to hear the perspective of the people who actually judged the evidence against Wilson. Because the jurors were under a gag order, McCulloch essentially was free to characterize their deliberations in any way he saw fit—and in a way that presented him in a more positive light than perhaps he deserved.
“In Plaintiff’s view, the current information available about the grand jurors’ views is not entirely accurate—especially the implication that all grand jurors believed that there was no support for any charges,” the lawsuit says.
The lawsuit names McCulloch as the defendant, since he is in charge of overseeing the gag order.
“Right now there are only 12 people who can’t talk about the evidence out there,” ACLU attorney Tony Rothert told the Associated Press. “The people who know the most—those 12 people—are sworn to secrecy. What (the grand juror) wants is to be able to be part of the conversation.” The suit includes fairly damning descriptions of McCulloch’s performance, saying the legal standards in the case were discussed in a “muddled” and “untimely” manner. There were stories after the grand jury verdict contending that McCulloch erred in not giving the jurors more options in bringing charges against Wilson. The suit is not trying to overturn the grand jury process—it merely contends that the circumstances of the Wilson case are unique because there is such an intense public interest in hearing from the juror. “The rules of secrecy must yield because this is a highly unusual circumstance,” Rothert said. “The First Amendment prevents the state from imposing a lifetime gag order in cases where the prosecuting attorney has purported to be transparent.” The grand jury of nine whites and three Blacks met over the course of three months, coming together on 25 days to hear more than 70 hours of testimony from about 60 witnesses. According to the AP, McCulloch said during a radio interview last month that some of the witnesses clearly lied to the grand jury.Rothert said the same grand jury members were able to compare how McCulloch handled the Wilson case to other cases because the grand jury had been empaneled since May and had been hearing other cases before it started hearing evidence in the Brown murder in August. The lawsuit accuses the prosecutor of handling the Wilson case much differently than the other cases, with “a stronger focus on the victim.”
“Believe me, there’s already more than a fair amount of skepticism about whether this process was fair, notwithstanding Mr. McCulloch’s cynical attempt to pretend that it was fair,” Jim Cohen, associate professor at Fordham University Law School and a grand jury expert, told the AP, adding that the juror had a strong case. “This matter has been discussed by virtually everybody in the universe with the exception of any person actually subjected to the presentation of evidence.”
It turned out to be a pretty rough year in 2014 for hip hop, as the album sales for the genre dropped more than 24 percent and CD sales plummeted by nearly 30 percent.
The culture around hip hop is certainly unlike any other music genre and the purchasing behavior of hip hop lovers is still one that is extremely hard to predict.
One thing that can be said for sure, however, is that more people are going online to get their fill of hip hop music rather than buying hard copy CDs. Consumers are also buying one or two hit songs from an artist rather than buying their entire album.
The trends left the hip hop industry struggling to break even in 2014.
According to Nielsen Music’s annual wrap-up, hip hop albums sold 24.1 percent less in 2014 than they did in 2013 and CD sales saw a 29.6 percent decline.
Digital sales also took a serious hit and dropped more than 20 percent since 2013. While the entire music business saw a decline in CD and album sales, hip hop was clearly hit the hardest.
It comes as no surprise considering not a single hip hop artist even managed to touch the top 10 album sales of 2014.
The drastic drop in sales is causing some people to question what is going on with the genre. Was the drop caused by a lack of interest in hip hop music or was it the result of a year full of lackluster albums? Perhaps it was the result of poor marketing or the sheer amount of songs being leaked before albums were even set to release. Quite frankly, the numbers suggest some truth to almost all of those possibilities. The interest in hip hop music is still incredibly high and hip hop artists are actually being used to help bridge pop stars to a new demographic they wouldn’t have reached otherwise. Hip hop stars have even become the holy grail for Disney and Nickelodeon stars who wish to shed the skin of their innocent TV personalities. Just look at Miley Cyrus, Zendaya, Ariana Grande and Nick Jonas. As far as lackluster albums, leaked tracks and poor marketing, it all played a part in the hip hop sales plummeting, along with the genre’s worst adversary—streaming services. Streaming services have long been hip hop’s arch nemesis and the Nielsen data proved that the rap industry’s villain struck again. Streaming numbers for the entire music industry increased more than 50 percent last year and hip hop and rap have long been the most popular genres on such services. While some believe the increase in streaming numbers is something to be optimistic about, it’s actually a number that suggests artists are having their profits snatched out of their pockets and if they can’t make money making music, they might not continue making it at all. Data released by Trichordist revealed that most streaming services were paying artists less than $.01626 per stream as of February 2014. Some of the most popular streaming services like Spotify were giving payouts as little as $.00521 per stream.This means that an artist would have to be streamed more than 120 times to equal the profits they would have made off of just one iTunes download.
The sharp increase in hip hop and rap music being streamed online just proves that the genre is still popular, but the fact that listeners are going online to stream their music rather than purchase it is still troubling for the genre.
This also doesn’t account for the fact that many hip hop artists find their tracks leaked online and thousands of would-be buyers are able to download their entire album for free before it even hits the shelves.
It’s a problem that the genre’s top selling artist of 2014 encountered with the release of his latest album, 2014 Forest Hills Drive. J.Cole topped the hip hop album sales charts after selling more than 577,000 copies. Shortly before its release, however, the entire album found its way online and many J. Cole fans admitted to downloading the free version.Nicki Minaj also saw her album, The Pink Print, get leaked online shortly before its scheduled release date.
Another major factor for the album sales drop could very well be the lack of albums put out by hip hop’s heaviest hitters.
Drake, Jay-Z and Kanye West are known to garner some of the most impressive album sales but none of the artists had new albums out in 2014.
They did dominate 2013, however.
Drake’s Nothing Was The Same ranked as the seventh best selling album of 2013 with 1.34 million album sales and Jay-Z came in at number 10 with 1.1 million album sales for Magna Carta Holy Grail.
Kanye’s Yeezus failed to live up to the sales of his previous albums but still pulled in an impressive 1 million in sales in the U.S.
So whether or not the increase in on-demand streaming for hip hop is a good thing really depends on perspective.
Once this trend is combined with such a drastic decrease in album sales, it also serves as a lesson for hip hop fans and hip hop artists alike.
For hip hop fans, they will have to support their favorite artists monetarily if they wish to see more great productions from them.
For hip hop artists, the digital age means that forming a certain bond and following with fans is just as important as making quality music if they wish to get listeners to take their support to the next level by actually purchasing their albums.
