Music Bussiness Survival Series Pt 4: Entertainment Law

Lisa Lopes

Lisa Lopes (Photo credit: Wikipedia)

By: Julian Harris Gibson

Many artists find out the hard way when it is too late that before they plan a world tour, they need to find a good entertainment lawyer. There have been countless horror stories of artists getting the short end of the stick when the profits came to pass. One of the most recent and famous stories was that of R&B super group TLC which sold a whopping 10 million records for their smash album in the mid nineties only to end up broke due to ignorance and shady business practices. Many people asked how in the world a group could sell that many records and end up broke but as a creative genius and lead singer the late Lisa “Left Eye” Lopez discussed it in a VH1 documentary.

During this film the singer explained how the group only received about one dollar per unit sold, which meant that the original pie for the artist was ten million dollars. This may seem like a boatload of cash, but keep in mind that the original retail price of a CD at that time was about 15.99 which meant at ten million copies sold the record label stood to make well over 150 million dollars. TLC’s share was less than 10 % meaning they only had five million to start out with.  After the label billed the group for the cost to produce, promote distribute and package the album, the group was left with a dismal $15,000 per artist, barely 1 % of total sales.

This case was on the extreme end of the spectrum, but is fairly common in the music business. The practice of billing the artist is known as “recouping” for expenses and is standard in many fields of business. However in the music business, many artists get caught up in the glitz and glamour of the bright lights and get hit by the train of reality –hard.