Early last month, a video landed on YouTube of rapper Megan Thee Stallion (pictured) discussing her current label situation right before things got dicier.
In her self-proclaimed “Free Megan Thee Stallion” on-camera grievance, the 25-year-old Texas-based entertainer talked candidly. She revealed being “stressed” and spoke about the ups and downs of her career. The “Big Ole Freak” hitmaker revealed that she is signed to two independent record labels (300 Entertainment and 1501 Certified Entertainment).
Megan also said that her business affairs are under management by virtue of her contractual agreement with Jay Z’s Roc Nation LLC. However, the crux of Megan’s label woes stemmed from her disagreement with 1501 Certified Entertainment. This Houston-based indie music house was founded by Carl Crawford, a former major league baseball player.
According to Megan, 1501’s leadership permanently shelved her future music projects when she asked if her contract could be restructured. In return, Megan sued 1501 Certified Entertainment in order to get out of her contract. Things have certainly gotten messy. A recent report by Pitchfork Magazine fully explained the details of this legal dispute on both sides.
“The lawsuit was filed (March 2) against 1501 and label head Carl Crawford, 38. Megan is suing for at least $1 million in damages and is asking for her contract to be declared null or terminated,” reads the report.
“The lawsuit claims that the contract dictates that 1501 is entitled to 60% of her recording income. The remaining 40% is reportedly allocated to Megan. However, the suit claims that she must use that portion of revenue to pay featured artists, mixers, remixers, and engineers,” the report also reads.
Crawford fired promptly fired back, calling Megan’s allegations “a whole lie,” according to Billboard Magazine.
“The reason why it was a 70-30 was because we gave up so much. We gave up part of her masters right now, we gave her a 60-40 split. That’s why we got so much on that side. We knew we did some stuff that people don’t do,” said the former franchise player for the LA Dodgers.
To be fair, record labels typically make major financial investments into artists’ careers. This can be a big gamble when there is no guarantee that the artist will gain the traction needed to net a decent return on investment. As a law student and online business news correspondent, I was able to reflect on this case personally with a proven brand builder.
“It costs anywhere from $40k-$50k to break a new artist/record,” said Quentin Witt, the Chief Digital Strategist for No Limit Records/TRU Muscle Entertainment.
“The burden of risk lies solely with the record label. With that in mind, the financials of an artist’s first contract should most definitely lean towards the label. It’s just business,” he continued.
As business partners in the past, Mr. Witt and I gained hands-on experience with building brands and developing talent. Our work promoting black female authors (who wrote about dating at BlackLoveAdvice.com) provided us a level of understanding and knowledge base, which was akin to the music business.
In her video grievance earlier this week, Megan Thee Stallion did admit her mistakes. Megan’s first was one was the common infraction of not properly reading her contract in full before signing it. She also gave “being 20-years-old” as an excuse.
However, someone with a more fiduciary and less personal duty may have handled negotiations more properly on her behalf. Some younger artists (including Megan herself) rely on loved ones to handle their business for them due to the trust and familiarity factors.
But sometimes, it can be more about valuing professional experience over what is felt in the heart; especially if family members lack the legitimate business wherewithal. However, Megan certainly has a management team guiding her today that is equipped with an abundance of skilled legal professionals.
Finally, there are ways to iron out deals more properly between labels and artists. These are called joint venture agreements.
These arrangements require both parties to pool their resources and split certain risks out evenly. Being an artist like Megan who is signed to an independent label can be fun. There is often more creative control and less nagging industry politics to deal with.
But there is a difference between being signed to an independent label and being an independent artist. A truly independent artist puts their own money up. They have invested in themselves because you cannot file a lawsuit against yourself in failure if you are truly the boss.
You can only look in the mirror.