Madonna’s Maverick Records label, home to the Material Girl as well as Alanis Morissette and Michelle Branch, has lost $66 million since 1999, according to recently unsealed court documents filed by its adversary and partner, Warner Music Group.
The documents relate to the latest spat in the 12-year-relationship between Maverick and Warner Music, which was recently bought from Time Warner Inc. by an investment group led by Edgar Bronfman, Jr. Time Warner is also the parent company of CNN.
Last month, Maverick sued Warner Music for $200 million, claiming breach of contract and fraud. The Warner documents were part of a pre-emptive claim filed in a Delaware court asking a judge to find that the company had fulfilled its commitment to Maverick.
The documents claim that in order for Maverick to get out of its joint venture with Warner Music, which is up at the end of the year, Maverick will have to pay $92.5 million, in addition to the value of Warner’s interest in the label. The price tag includes the $66 million in losses, a $20 million loan and $6.5 million in unrecouped fees.
According to Warner Music’s filing, if Maverick cannot raise the money needed to buy itself out the joint venture, Warner can convert the label into a “purely passive economic interest,” taking all control of the label away from Maverick. In this case, Maverick would reap no profits from the label until the losses were repaid.
A Warner Music spokesman declined to comment. Maverick could not be immediately reached. The label is gearing up for the May 18 release of Morissette’s first album in two years, “So-Called Chaos.” The following week, Madonna begins a world tour in Los Angeles.
Source CNN.com.
