Embattled Grammy Chief Asked Recording Academy for $22M to Leave Quietly

Deborah Dugan
 John Lamparski/WireImage

Recording Academy president and CEO Deborah Dugan Speaks at the 62nd Grammy Awards Nominations at CBS Broadcast Center on Nov. 20, 2019 in New York City. 

Deborah Dugan turned down a multi-million dollar counter offer, sources tell Billboard.

On Jan. 10, six days before Recording Academy CEO/president Deborah Dugan was placed on administrative leave, she asked for a $22 million settlement, the Recording Academy tells Billboard

The Recording Academy countered with a multi-million dollar offer, two sources tell Billboard -- for much less than $22 million -- which she turned down. Dugan's initial deal with the Recording Academy was for three years with an annual salary of slightly less than $1 million, plus bonuses, according to sources.

In a memo sent prior to Jan. 10 to the Recording Academy’s head of human resources, Dugan, who started Aug. 1,  accused the Recording Academy of paying exorbitant legal bills, improper voting conduct and conflicts of interest among members of the board of trustees and outside legal counsel, according to a source. The Recording Academy would not confirm the counter offer or if there were any terms attached to Dugan’s proposed settlement, but in a letter sent to the Academy’s membership on Monday (Jan. 20), board chair Harvey Mason Jr. said that Dugan’s attorney “informed the Executive Committee that if Ms. Dugan was paid millions of dollars, she would ‘withdraw’ her allegations and resign from her role as CEO.”

Mason, a well-known producer and songwriter, who has worked with such artists as Whitney Houston, Britney Spears, Michael Jackson and Chris Brown -- and is a producer on the forthcoming Aretha Franklin biopic starring Jennifer Hudson -- stepped in as interim Recording Academy CEO after Dugan was placed on leave. 

Dugan’s co-counsel Douglas Wigdor said Dugan declined to comment.

On Jan. 16, the Recording Academy’s board of trustees placed Dugan on leave after a senior female staffer, understood to be director of administration Claudine Little -- and former CEO/president Neil Portnow’s longtime right hand -- accused Dugan of alleged misconduct including bullying, a source confirmed to Billboard. The Recording Academy has hired two independent third party investigators to address the allegations.The investigations are expected to wrap in early spring.

After Dugan was placed on administrative leave, her attorney Bryan Freedman said in a Jan. 17 statement, “When our ability to speak is not restrained by a 28-page contract and legal threats, we will expose what happens when you ‘step up’ at the Recording Academy, a public nonprofit.”

The stakes continued to rise with Freedman revealing on Jan. 18 that he hired a security detail to protect Dugan, “based upon credible and extremely disturbing information.” He told The Hollywood Reporter, Billboard’s sister publication, that he heard the threat himself, though declined to elaborate further details or who communicated the threat. On Jan. 20, Freedman was joined by New York-based co-counsel Wigdor, to represent Dugan. Wigdor was not of counsel at the time Dugan asked for the settlement. 

As the Jan. 26 Grammy Awards approach, the fighting threatens to steal the spotlight from the ceremony. One source advises that the two sides should come to an agreement and move forward: “Settle her out and get through the show as unmarred as possible and then quickly get a new CEO.” 

Otherwise, they caution the longer the public battle continues, more damage is being done daily to an already embattled Recording Academy still reeling from two recent scandals. 

In 2018, the academy came under fire when Portnow, after that year’s January ceremony, said women in the music industry should “step up” to advance their careers and be recognized by the Grammys. That comment, which he said had been taken out of context, led a number of prominent women in the music industry to call for his dismissal and the establishment of a task force to review the Academy -- and music industry’s -- lack of inclusion and diversity. Portnow stepped down in July 2019 following the end of his contract and a 17-year tenure.

In April 2018, Dana Tomarken, longtime MusiCares and Grammy Foundation vp, was terminated. She followed with a letter written to the Academy’s Board of Trustees excoriating the Academy and accusing Portnow of moving funds away from MusiCares (he and the Academy denied any wrongdoing) and then sued for wrongful termination. In November 2019, Tomarken and the Recording Academy reached a settlement.

One Recording Academy insider stresses the urgency to settle and move on past the last two years’ troubles, asking Billboard: “How much longer does [the Recording Academy] want to drag this out before they risk having to rebuild the whole organization from scratch?" 

Assistance in preparing this story provided by Claudia Rosenbaum. 

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