Sullivan and Peterick now allege that Sony Music has stiffed them on royalties. Specifically, the plaintiffs say their 1978 recording agreement means they should be taking an even 50/50 split with respect to licensed masters. But Sony is alleged to be treating downloads off of platforms like iTunes and Amazon as "sales of records" instead of licenses. Typically, the royalty share on sales is closer to 15 percent.
That's not all.
The Survivor members also say they haven't paid them on income derived from settlements with Napster, Grokster, Kazaa and others. And they Sony has improperly charged and deducted from royalties certain promotion and marketing costs.
The breach-of-contract complaint filed by Sullivan and Peterick is fairly typical except for an allegation involving their discussions with the defendant.
"Indeed, a Sony representative threatened that in the event Survivor persisted in its objection, Sony would exercise what it termed 'the nuclear option' – removal of the Survivor Masters from the songs licensed to iTunes for download by consumers, thereby wiping out that revenue stream altogether," says the lawsuit. "By threatening 'the nuclear option,' Sony has conceded that its transaction with iTunes is a license subject to termination, and not a sale, of the Survivor Masters to iTunes. If it was a sale, Sony would have no right to demand return of the songs."
Besides compensatory damages, the plaintiffs want an injunction that would prevent Sony Music from pulling music from digital outlets.
A representative for Sony Music didn't immediately respond to a request for comment.