A major case regarding digital royalties known as the “Eminem case” has been settled and will lay the groundwork for how similar disputes will be resolved. Plaintiffs F.B.T productions and Em2M, formerly responsible for Eminem’s publishing and production, filed the suit against UMG and Aftermath back in 2007. The suit was largely based around the issue of royalties for digital sales, including downloads and ringtones. The plaintiffs alleged that they were entitled to a bigger piece of the pie to the tune of hundreds of millions of dollars. Via Variety:
The F.B.T. case had been closely watched, for several class actions and individual suits had been launched in the wake of the appellate decision by artists – - most of them heritage acts with contracts dating in many cases back to the ‘70s—who claimed they were also entitled to higher digital royalties. In nearly all cases, the actions cited the appellate decision as a precedent.
In those suits, virtually all the plaintiffs have claimed that they are entitled to a royalty rate of 50% of net receipts, granted for masters licensed to third parties. As in the F.B.T. case, the plaintiffs have claimed that they were paid at a far lower royalty rate, usually 12%-20%, for records sold.
F.B.T moved to dismiss their suit after a settlement was reached with UMG and Aftermath Records. The ruling will prove to be influential, given how outdated copyright laws became ambiguous when applied to the modern music market.