Deyon Davis is a songwriter and the head of a business that claims responsibility for representing hundreds of songwriters in placing their music in films and on hit TV shows like "American Idol," "So You Think You Can Dance" and "Jersey Shore." A year ago, Davis was sued by BMI, the performance royalty collection society, for submitting falsified "cue-sheets," allegedly obstructing the organization's calculation of royalties. Last week, Davis struck back with a counterclaim that alleges that BMI has engaged in a broad scheme to rip off songwriters and publishers.
BMI licenses TV networks so that shows airing on these channels can air music during programs. When TV shows air music, producers are tasked with keeping track of the names of songs, how the music is used, and for how long in "cue sheets" given to BMI. These sheets are the primary way that performance rights organizations keep track of music on television and apportion their licensing revenue to songwriters.
In its lawsuit against Davis last December, BMI accused him of submitting falsified cue sheets that allegedly made it difficult to track song usage and calculate proper royalties. After allegedly discovering anomalies, BMI approached various TV producers in an investigation and says it found that Davis was overpaid by $1.5 million and others were overpaid by hundreds of thousands of dollars.
The court documents say that Davis approached one of his songwriters, Max Golay -- who worked for a company hired by the producers of "So You Think You Can Dance" and "Superstars Of Dance" to prepare cue sheets -- to revise the cue sheets so that it contains false information about the music used during the show.
According to the amended complaint, Davis approached Golay and told him he was experiencing financial difficulty and convinced Golay to change the cue sheets. The falsified cue sheets labeled background instrumental as background vocal music; and also increased the duration of the cues, in order to obtain a higher rate, according to the court documents. Moreover, the revised cue sheets also added new cues of music during what appeared to be commercial breaks.
"The overall result of these changes was substantially higher royalty payments," BMI alleged.
Golay admitted his role in revising the cue sheets and repaid BMI more than $121,000 in July 2010, the documents state. Moreover, Dance Nation and Masters of Dance subsequently submitted corrected sheets to BMI. But in an answer to the initial BMI complaint, Davis denies the allegations in the BMI complaint "that purports to describe conduct undertaken by him."
He counter claims that Golay concocted the scheme to produce inflated payments for his own benefit, and did it for others songwriters so it would be harder to detect his fraud.
But BMI says in the documents that this isn't the first time the company has detected revised cue sheets with Davis' involvement. In September 2008, a company called Rocket TV Entertainment submitted revised cue sheets for some MTV Networks programming including "The Real World," "Battle of the Sexes," and "Punkd."
The documents say BMI was unable to confirm the legitimacy of Rocket TV and that "Davis subsequently confirmed that he had submitted the revised cue sheets to BMI as Rocket TV in order to make it appear to BMI as thought the cue sheets were being submitted by a production company and thereby circumvent BMI's general policy against accepting cue sheets from its affiliated writers." But Davis denies that allegation in his answer to the BMI complaint.
Last Friday, Davis lashed out against BMI with a counterclaim, which begins: "Metaphorically speaking, BMI is a bully. BMI deceptively lures unsuspecting songwriters and publishers into its playground (BMI's performing rights licensing and royalty system) with the promise of fun (the fair calculation and payments of royalties) and then spends the day bossing them around, beating them up and taking their toys."
Davis goes on to claim that BMI "deliberately employs an unclear royalty calculation system for tracking public performances in order to decrease the amount of royalties it must pay to its affiliates."
BMI is then charged with "serving as its own judge and executioner."
After BMI filed the lawsuit against Davis, it allegedly withheld payments from him. Davis says he hasn't received anything in a year and a half, which he argues is tantamount to rendering any defense of BMI's claims to be pointless. He's countersuing for breach of contract, breach of implied covenant of good faith and fair dealing, conversion, negligent misrepresentation, negligence, and more, demanding nearly $400,000 in compensatory damages and an order that would enjoin BMI from "utilizing misleading statements in advertisements and promotional material regarding its ability to accurately track public performances of its affiliates' copyrighted works on television shows."
In its complaint, BMI noted that its standard practices are published in its "Royalty Information Booklet" and specifically provide that, with respect to royalties paid in error, the affiliate may be expected to repay on request the balance of an overpayment that remains unrecouped." It further alleged that the defendants had unilaterally and fraudulently" accepted more consideration than was agreed upon."
BMI declined to comment on the situation.