Capitol Records Claim to Beatles Rights Against Vee-Jay Undecided in Windy City
CHICAGO —TheCapitol–Vee JaylawsuitoverBeatles product was in what one attorneydescribedasa“stateof limbo,” with counsel for both sides due in Appelate Court last Friday (February 7) afternoon for further hearings.
Last Wednesday (February 5). the Appelate Court granted Vee Jay stay on Capitol’s injunction prohibiting Vee Jayfrom selling Beatles records.
The stay was issued pending Vee-Jay’s appeal and on the condition that Vee-Jay post a S30,000 bond. The bond was posted, but,meanwhile, Capitol attorneysfiledapetitionforrehearing.
Therehearingwasscheduledfor Friday (February 7).andthe court held off approval of the Vee Jay bond pending the out come of the hearing.Vee Jay thus continued to be prohibited from shipping or manufacture Beatles records, though the situation could conceivably be different asthis (Billboard) issue comes off the press. END
_______________
Credit source information: Billboard, February 15, 1964
A MCRFB Note: For a recent post regarding this Billboard story GO HERE
Bid To Buy Chapter 11 Vee-Jay Records; Set Hearing June 3
LOS ANGELES —June 3 has been set as the date for Chicago bankruptcy referee Shaeffer to hear local attorney William Bluestein’s formal proposition for the purchase and reorganization of Vee Jay Records, currently in chapter 11 status.
Bluestein represents a group of individuals who are interested in reorganizing the label. He said that referee Shaeffer had “tentatively approved as feasible,” his program for rejuvenating Vee Jay last Tuesday (May 17) but then continued the hearing into June.
The matter of who gets possession of 69 Four Seasons masters was also continued until June 3.
Bluestein revealed that Vee Jay owes the government $11/2 million and has $1.8 million in creditor’s debts. The attorney said he has worked out a plan with the government to liquidate the tax claims and that all creditors would receive a percentage of the moneys owed them.
The label would be brought back to L. A. Bluestein intends to purchase all the stock owned by James and Vivian Brackens and the small per cent owned by Mr. Bracken’s brother. Bluestein’s combine is interested in operating Vee Jay’s R&B and gospel catalog. END
___
(Information and news source: Billboard; May 28, 1966)
CHICAGO — An unidentified West Coast combine is bidding for debt-ridden Vee-Jay Records, a bankruptcy hearing in U. S. District Court here revealed last week.
The group’s attorney said the purchase is contingent upon whether or not 69 Four Seasons’ masters would be included in the acquired assets. The Seasons formerly recorded for Vee-Jay.
The masters in question were awarded to Vee-Jay in a settlement when the singing group was signed by Philips records. Under terms of that agreement. the masters were to go to Mercury Record Corp. in the event that Vee-Jay, even then on shaky ground financially, went bankrupt.
An attorney representing Four Seasons’ agents, Barneget Enterprises, declared in court here last week that the masters must revert to Mercury. The issue of who gets the Four Seasons’ masters will be decided by the court referee in a hearing May 17. If the ruling grants the masters to Mercury-Philips, the West Coast combine will drop its purchase bid. If the ruling favors sale of the masters to Mercury-Philips, the West Coast combine will drop its purchase bid. If the ruling favors sale of the masters to the Vee -Jay buyers, the combine will pick up Vee-Jay’s $1.8 million debt with a promise to pay creditors a dime on every dollar.
A separate arrangement will be made, in the event of a Vee-Jay sale, with regard to taxes owed the government.
NOT BANKRUPT
At the moment Vee-Jay is not technically bankrupt. The company is under chapter II of bankruptcy law, still seeking a financial arrangement under a petition filed here in January.
At that time Vee-Jay president James Bracken said, “The proceedings were instituted with the expectation that the corporation could be reorganized on a sound financial basis. . . “
If in the May 17 hearing the Four Seasons’ masters go to Mercury and the purchase offer is withdrawn, the court will order receiver Gerald W. Grace of Chicago to take steps to liquidate Vee-Jay.
Meanwhile, Vee-Jay has suspended all operations and all employees have been released. Telephone callers discover that Vee-Jay’s telephone has been disconnected.
Formed in Chicago, in 1953, Vee-Jay moved to Los Angeles in 1964 to be closer to its management team. The company was hot at the time, with the Beatles under contract. The company fell into financial difficulty, lost the Beatles, and moved back to Chicago last fall.
At its return to Chicago, Vee-Jay had Jerry Butler, Betty Everett, Jimmy Reed, Little Richard, John Lee Hooker, the Dells, Joe Paige, Russ Morgan, Harry (Sweets) Edison, Fred Hughes, Joe Simon, Orville Couch and several gospel acts under contract.
Butler’s contract with Vee-Jay expires May 31, and he has been signed by Mercury.
One of the group seeking to buy Vee-Jay is reportedly Betty Chiapetta, former Vee-Jay controller. Identities of other parties in the combine are being withheld, but it is believed that some well -known industry figures are involved. END
___
(Information and news source: Billboard; May 14, 1966)
CHICAGO — The Capitol vs Vee-Jay lawsuit was in what one attorney described as “a state of limbo,” with counsel for both sides due in Appelate Court last Friday afternoon, for further hearings. February 7.
Last Wednesday, the Appelate Court granted Vee-Jay a stay on Capitol’s injunction prohibiting Vee-Jay from selling Beatles records.
The stay was issued pending Vee-Jay’s appeal and on the condition Vee-Jay post a $30,000 bond. The bond was posted, but meanwhile, Capitol attorneys filed a petition for rehearing.
The rehearing was scheduled for Friday, February 9, and the court held off approval of the Vee-Jay bond pending the outcome of the hearing. Vee-Jay thus continued to be prohibited from shipping or manufacturing Beatles records, though the situation could be conceivably different as this issue comes off the press. END
___
(Information and news source: Billboard; February 15, 1964)
MCRFB ADDENDUM
For more read on the Beatles, Capitol Records vs Vee-Jay Records story archived here on Motor City Radio Flashbacks, we have the linkhere.
BEATLES on the Vee-Jay Records label, 1964 (click on image for larger view)
GROUP EXITS VEE-JAY LABEL; CREWE TO CONTINUE PRODUCTION REIGN WITH GROUP AT PHILIPS
CHICAGO — The Four Seasons have been signed by Philips Records. The group has enjoyed a half-dozen singles smashes in the last 16 months, three were No. 1 entries previously held on the Billboard charts. All of their hits, as well as five of the group’s albums, were introduced on the Vee-Jay label.
Under the terms of the new deal, Philips will release recordings by the group throughout the world through its overseas affiliate. Their initial single, “Dawn,” is due out at once. Disks by the group will continue to be produced by Bob Crewe.
The original Vee-Jay deal involved an agreement between Crew’s production firm from the label, with the masters leased to Vee-Jay. A Crew spokesman stated that they terminated this arrangement last year because of what they called “breaches” and violations in the agreement found with Vee-Jay Records. Since that time, the group has been without a recording contract.
Among the Four Seasons principal hits were “Sherry,” “Big Girls Don’t Cry,” “Walk Like A Man,” “Ain’t That A Shame,” “Candy Girl” and “New Mexican Rose.”END
___
(Information and news source: Billboard; January 18, 1964)
CHICAGO — Vee-Jay Records, which scaled the sales heights before losing the Beatles in 1964, plunged into formal bankruptcy here last week.
In a hearing in U. S. District Court August 1, an offer by a West Coast combine to acquire the debt-ridden Chicago recording company was withdrawn and the court ordered receiver Gerald W. Grace to liquidate the company.
The acquisition offer was withdrawn because Vee-Jay’s obligation to the U. S. Government were considered excessive, Billboard has learned.
Vee-Jay has been in Chapter 11 status since early this year when President James Bracken announced that the firm had filed a petition for financial arrangement.
“The proceedings were instituted with the expectation that the corporation could be reorganized on a sound financial basis,” Bracken said.
In a hearing in May, a group represented by attorney William Bluestein of Los Angeles announced interest in acquiring Vee-Jay, which then owed the government about $1.5 million and had nearly $2 million in outstanding debts.
Bluestein’s group was interested in acquiring 69 4 Seasons masters, which were bid for at the same hearing by counsel for the 4 Seasons group. Bluestein’s interests would have made a financial arrangement with the government and would have paid creditors a dime on the dollar or 1/10th of 100 percent owed to each creditor.
‘The 4 Seasons Sing‘ on Vee-Jay Records; 1963. (Click on image for larger view)
The 4 Seasons contract with Vee-Jay Records reportedly called for the masters to revert to their agents, Genious, Inc., in the event of company bankruptcy. The masters will undoubtedly find their way into the catalog of Philips Records, a Mercury Records affiliate, also based in Chicago. The masters in question were awarded to Vee-Jay in a settlement following the signing of the group by Philips.
Vee-Jay suspended all operations here in May. The company was founded in Chicago in 1953, moved to Los Angeles in 1964 and returned last year. When the label returned to Chicago, the company had such artists as Jerry Butler, Betty Everett, Jimmy Reed, Little Richard, John Lee Hooker, the Dells, Joe Paige, Russ Morgan, Harry (Sweets) Edison, Fred Hughes, Joe Simon, Orville Couch and several gospel acts. END
___
(Information and news source: Billboard; August 13, 1966)
Who owns the Beatles? Capitol Records vs. Vee-Jay Records, “cease and desist,” legal wranglings and continuous copyright ownership infringements claims against the Vee-Jay label, as this 1963 telegram would suggest, brought an ultimate end to Vee-Jay Records. The company was sued out of the business by mid-1966.Beatles LP on Vee-Jay Records, released early-1965.
The Beatles‘ on VeeJay Records in 1964. (Click on image for larger view)
NEW YORK — Vee Jay Records filed a motion in New York’s Supreme Court against both Capitol Records and Swan Records here Friday seeking an injunction restraining the companies from manufacturing, distributing, advertising or otherwise disposing of recordings by the Beatles.
The motion was brought before Judge Mullen in Supreme Court, who reserved decision on the case.
The case is but one of many suits and counter-suits being bandied about the courts over the sensational young singing groupfrom Liverpool.END
___
(Information and news source: Billboard; January 25, 1964)
From the MCRFB NEWS archive: 1964
Beatles Heat Flare In Court
CHICAGO — The Beatles, the nation’s hottest recording property today, are becoming the object of the nation’s hottest lawsuits, at least as far as the recording industry is concerned.
The rock-and-rolling English group has a series of singles and LP’s out on three labels–Capitol, Vee Jay and Swan. Each of the offering is bounding up the national charts like Topsy.
And each is becoming involved in a series of suits and counter-suits between the various companies involved.
The Beatles‘ “She Loves You” on Swan Records in 1964.
Most confused are the nation’s dealers and one-stops, many of whom have received telegrams from one or more of the parties, noting that appropriate legal action will be taken if they persisted in selling the others’ products.
The matter is far from settled, but as of Billboard press time, Capitol was granted an injunction in Cook County Circuit Court restraining Vee Jay from manufacturing, distributing, advertising or otherwise disposing of the Beatles’ recordings.
The Capitol injunction is good for thirty days and Vee Jay is slated to file an answer next Wednesday.
Vee Jay, meanwhile, has filed a suit seeking a similar injunction against Capitol and Swan, with a hearing slated for New York’s Supreme Court before Judge Saul Streit, last Friday.
Under the Capitol injunction, “Vee Jay, it’s agents, attorneys and servants” are prevented from selling or advertising Beatles’ products.
Presumably, and according to Vee Jay sources, the injunction does not apply against dealers, one-stops, rack jobbers and even distributors who might already have the records in stock.
According to Jay Lasker, Vee Jay executive vice-president, “we shipped an awful lot of records, more than Capitol.”
Capitol attorney, Sidney Zatz, however, has indicated that “steps could be taken” against dealers who persisted in selling the Vee Jay product, though he did not specify what this would entail.
The product causing all the fuss is:
Capitol, “I Want To Hold Your Hand,” a single, is at No. 3 on Billboard’s Hot 100 this week, and “Meet The Beatles,” an L.P.
Vee Jay, “Please Please Me,” a single, and two LP’s, “Introducing The Beatles,” already distributed, and “The Beatles and Frank Ifield,” were not yet shipped but ready to go.
Swan, “She Loves You,” a single, is breaking into Billboard’s Hot 100 in position 69.
Neither Vee Jay nor Capitol is seeking damages as of this date, though a Capitol spokesman did not rule out the possibility of this taking place at a later date.
In its motion for injunction, Capitol claimed exclusive U.S. distribution rights to all recording by the Beatles. The label accused Vee Jay of manufacturing and selling albums introducing the Beatles in violation of Capitol’s exclusive right.
Capitol contended in its suit that Vee Jay’s rights were canceled last August.
The suit notes that initially Vee Jay was licensed by Trans Global, a New York firm licensed to distribute EMI products. EMI has the original Beatles’ contract.
Capitol claims that Trans Global canceled its contract with Vee Jay August 8 because of non-payment of royalties. Trans Global allegedly relinquished its rights to EMI with the latter than returning them over to Capitol.
Vee Jay, meanwhile, contends that it has a five-year contract with the Beatles and that it is definitely not in default for failure to pay royalties.
Capitol’s suit notes that the label has spent $50,000 in extensive nationwide promotions of the Beatles recordings. END
___
(Information and new source: Billboard; January 25, 1964)
Capitol Records Claim to Beatles Rights Against Vee-Jay Undecided in Windy City
CHICAGO — The Capitol–Vee Jay lawsuit over Beatles product was in what one attorney described as a “state of limbo,” with counsel for both sides due in Appelate Court last Friday (February 7) afternoon for further hearings.
