{"id":2860,"date":"2024-10-02T18:53:59","date_gmt":"2024-10-02T18:53:59","guid":{"rendered":"https:\/\/usatrustedlawyers.com\/blog\/no-ruling-before-damon-dash-auction\/"},"modified":"2024-10-02T18:53:59","modified_gmt":"2024-10-02T18:53:59","slug":"no-ruling-before-damon-dash-auction","status":"publish","type":"post","link":"https:\/\/usatrustedlawyers.com\/blog\/no-ruling-before-damon-dash-auction\/","title":{"rendered":"No Ruling Before Damon Dash Auction"},"content":{"rendered":"\n
\n

\n\tA federal judge is refusing to wade into whether Jay-Z can use copyright termination to retake control of the rights to his debut album Reasonable Doubt<\/em> \u2014 meaning that the complex issue won\u2019t be resolved before a court-ordered auction of Damon Dash<\/strong>\u2019s one-third stake in the company that owns the album.<\/p>\n

\n\tThe judge had been asked to decide that tricky question because of allegations that Jay-Z was using \u201cfalse\u201d threats of a looming termination to drive down the auction price for Dash\u2019s stake in Roc-A-Fella Records Inc., which controls the rights to the famous album.<\/p>\n

\n\tBut in a ruling Monday (Sept. 30), Judge Robert W. Lehrburger<\/strong> flatly refused to do so \u2014 saying he had no legal power to add complicated questions of copyright law to the already-messy fight over Dash\u2019s stake.<\/p>\n

\n\t\u201cThe asset that is the subject of the auction is Dash\u2019s one-third interest in RAF [Roc-A-Fella] itself, not the work owned by RAF,\u201d the judge wrote. \u201cThe Court does not presently have jurisdiction over the validity of Carter\u2019s copyright termination notice.\u201d<\/p>\n

\n\tAs early as next month, the U.S. Marshals Service will sell off Dash\u2019s 33.3% interest in Roc-A-Fella Inc., an entity whose only real asset is the sound recording copyright to Reasonable Doubt<\/em>. The rest of the storied label, which Dash co-founded with Jay-Z in 1994, is not involved.<\/p>\n

\n\tThough the court-ordered auction was originally intended to pay off an $823,000 judgment in a civil lawsuit, it has since expanded to include other Dash creditors. New York City\u2019s child services agency wants some of the proceeds to go toward more than $193,000 that Dash owes in unpaid child support; New York state says they must pay down roughly $8.7 million that Dash owes in back taxes and penalties.<\/p>\n

\n\tThe owners of the other two-thirds of Roc-A-Fella \u2014 label co-founders Jay-Z (Shawn Carter) and Kareem \u201cBiggs\u201d Burke<\/strong> \u2014 have already attempted to stop the auction, including making changes to the company\u2019s bylaws and intervening in the lawsuit. But a federal judge rejected such opposition in February, and the sale could take place as early as this month.<\/p>\n

\n\tAs the auction has approached, one major unresolved question for any potential buyer is just how long Roc-A-Fella will continue to own its only real valuable asset.<\/p>\n

\n\tThe so-called termination right, a provision created by Congress in the 1970s, empowers authors to reclaim ownership of copyrighted works decades after they sold them away. If Jay-Z is eligible for it, termination would allow him to take back the rights to his sound recording of Reasonable Doubt <\/em>roughly 35 years after he released the album, meaning 2031. That would set a clear time limit on the amount of revenue a Roc-A-Fella buyer would derive from their investment.<\/p>\n

\n\tBut last month, attorneys for New York City filed court papers arguing that Jay-Z was not, in fact, eligible for termination \u2014 and that he and others were using \u201cfalse\u201d threats of an approaching termination to drive down the price of Dash\u2019s stake in his company.<\/p>\n

\n\t\u201cJay-Z\u2019s statements to the press have poisoned the environment for the auction,\u201d wrote Gerald Singleton<\/strong>, an attorney for the city, asking the judge to halt the auction and issue a ruling on whether or not Jay-Z could use termination to win back control of Reasonable Doubt<\/em>.<\/p>\n

\n\tDays later, Jay-Z lawyer Alex Spiro<\/strong> responded that there was \u201cno merit to NYC\u2019s accusations,\u201d and that the Dash case was not the proper place to decide Jay-Z\u2019s rights to the album: \u201cPut simply, this is not the appropriate time, forum, or case to litigate any issues relating to Jay-Z\u2019s notice of termination.\u201d<\/p>\n

\n\tIn Monday\u2019s ruling, Judge Lehrburger agreed with Spiro and Jay-Z: \u201c[NYC]\u2019s motion to stay the auction for purposes of having this court determine the validity of the copyright termination notice filed by Shawn Carter a\/k\/a Jay-Z in connection with the work Reasonable Doubt, an asset owned by RAF, is denied.\u201d<\/p>\n

\n\tThe judge also rejected New York City\u2019s attempt to conduct discovery into Roc-A-Fella\u2019s holdings, saying that kind of investigation was also beyond the scope of the current litigation. An attorney for the city declined to comment on the order.<\/p>\n

\n\tThe auction is currently scheduled for Oct. 21, but it has been postponed multiple times and could be delayed again. A minimum purchase price has been set at $3 million.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

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