Ye's lawsuit against EMI Music Publishing is understandable, but his pattern of business decisions may lead to similar challenges down the road.
|Mar 7||Public post|
Kanye West (via YouTube)
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Kanye West has made enough statements about freedom, slavery, and “choices” to last a lifetime. But he has a legitimate case to make in his legal “fight for freedom” from EMI Music Publishing. The Hollywood Reporter (THR) shared the following segment from Ye’s 2003 contract with EMI:
At no time during the Term will you seek to retire as a songwriter, recording artist or producer or take any extended hiatus during which you are not actively pursuing Your musical career in the same basic manner as You have pursued such career to date. (The preceding representation shall not be deemed to prevent You from taking a vacation of limited duration.)
That vacation line got me! EMI out here tracking PTO days?!
The Chicago rapper received an advance of a few hundred thousand dollars in return. The publisher has a 50% ownership stake in his music. Most artists in Kanye’s position have referenced California’s seven-year rule which limits the term of such contracts. Disputes like this often result in renegotiations between the publisher and artist. But Kanye wants more. Here’s another excerpt from THR:
The hip-hop star is not only seeking the ability to sign new deals with other record labels and music publishers, but West's lawsuit also alleges that EMI has been unjustly enriched by millions of dollars. He seeks a declaration that EMI may not exploit the compositions West has already delivered to the company after October 2010. In other words, West wants the judge to declare him the owner of these works.
If Kanye wins this case, it can shift the music industry. These decisions carry weight. Hip-hop is on an ownership tip right now. A victory would fuel that momentum.
But despite the potential to set precedence, this feels like a temporary solution for Ye. The Grammy award-winning artist has built his careers in music, fashion, and clothing on the strength of partners with deep pockets. He shows no signs of changing that approach. And now he wants complete ownership from EMI, Roc-a-Fella Records, Def Jam, and others who funded his rise in stardom.
Ye might be justified in this particular lawsuit. Regrettably, his business mindset and goals may land him in the same situation soon enough.
Partnering with the top names comes at a cost
Kanye constructed his career on the foundation of status at the expense of ownership. He signed with the Roc in 2003 to prove doubters wrong and certify his place in hip-hop. When Jay Z and Damon Dash split, Ye sided with his Big Brother. The Yeezus rapper felt more connected to Dame’s mentality, but rocked with Jay to learn “how to move in a room full of vultures.”
When Ye enters an industry, he wants to partner with the top names. In 2016, he asked Mark Zuckerberg and Larry Page for $1 billion to invest in his ideas. He came up short with the tech leaders, but a similar approach helped him navigate the athletic apparel world. Both Nike and adidas have been home to the popular Yeezy sneaker line. Kanye could have easily launched the Yeezys under his Yeezy Apparel company, but that’s not his goal. He let the athletic apparel titans take their cut so he could leverage their branding and distribution. According to sources, the Yeezy brand is worth $1.5 billion.
The few times that Ye tried the launch ventures on his own though, he came up short. In 2016, he shared that he was $53 million in debt. Vanity Fair broke down how Ye’s early failures in fashion attributed to that debt:
In 2009, he put all of his musical endeavors aside to work on his label, Pastelle—which then shuttered after seven months. Add to that however much it cost to create his line of G.O.O.D. merchandise, marketed to fans of his record label. He was chewed up and spit out for his attempt at a high-end women’s-wear line called Kanye West in 2011. The line never made it to stores.
These setbacks stung financially and emotionally. When he speaks about his early days in the fashion world, he’s much more likely to reminisce about his 2009 Fendi internship alongside Virgil Abloh, who is now the men’s artistic director at Louis Vuitton. It gave West a desired stamp of credibility—like a business school grad who wants to get two years in at McKinsey & Co.
When Kanye gets reminded of his failures, he often tenses up. In 2014, Sirius XM’s Sway Calloway tried to connect with Kanye. The radio host mentioned his similar but smaller-scale failures in fashion. Ye quickly status-checked Sway with the infamous line, “It ain’t Ralph tho.”
This is Kanye’s mantra. The strategy has served him well. A few setbacks aside, these partnerships with Roc-a-Fella, adidas, Fendi, and others gave him the platform he coveted to bring his dreams to reality. But now that Kanye’s reaped those benefits, he wants ownership from the companies that boosted his launch. This is where the imminent challenge lies.
Here’s the “it ain’t Ralph tho” clip from 2014. Gotta give Sway credit for keeping his cool! (via YouTube)
The lawsuit might be a temporary victory
If Kanye wins this court case, he will reclaim his masters and publishing. He will get paid from the lawsuit and start earning the money that EMI and Roc-a-Fella currently make. Kanye’s income will surely rise. But Ye is not the type to let that extra cash grow quietly in a Betterment account. Kanye will likely use the extra funds to fuel his future business pursuits.
Last May, Charlamagne Tha God interviewed Kanye to get a sense for where his head is at. The two walked along 300 acres of Kanye’s newly purchased property. Kanye shared his future goals, “I'm going to be one of the biggest real estate developers of all time. Like what Howard Hughes was to aircraft and what Henry Ford was to cars.” Here’s a tweet from Ye shortly after the interview:
Despite the Yeezy umbrella branding, there’s no way this project will be funded solely by Ye himself or a small group of investors. Kanye will most likely finance it through bank loans (like he’s done in fashion) or get billionaires to front him money. In return, those billionaires will want a larger stake than Kanye may desire, but that’s the give and take. If these developments come to fruition and become successful, could we see Ye fight for more ownership from those partners? Just like he has with his EMI and Roc-a-Fella? There’s a pattern. In 2017, Kanye parted ways with Tidal because he wasn’t properly compensated for the 1.5 million subscribers who joined when The Life of Pablo dropped. Kanye clearly has justification, but the habitual nature of these disputes is hard to ignore.
Some may see it as a strategy: build partnerships despite the lopsided contracts and terms, become successful on the foundation of the partnerships, then take legal action to renegotiate the contract or retain ownership. Kanye is not the first in hip-hop to do this, but his rationale seems more reactionary and less intentional. The most logical answer is that he realizes the contractual limitations after the fact and wants out. It’s a less scandalous conclusion, but given Kanye’s public actions in recent years—in and outside of business—it’s the most logical.
The one things Kanye wants to reclaim (but can’t sue for) is his role as hip-hop’s chart-topper. Drake has worn this crown for a minute and shows no signs to give it up. Ye has been envious of the 32-year-old rapper for the better part of a decade. If you read Trapital regularly, you know that the “God’s Plan” artist lives the epitome of that partnership life. He has leveraged the industry’s value chain to build and maintain his position.
Kanye still wants that. His viral Sunday Services show his desire to regain cultural relevance. Last year’s listening party in Wyoming was another sign of his quest for belonging. I can picture Kanye saying to himself, “If I can get all these folks to come to this random ass ranch in middle America and STILL wear my MAGA hat, I still got it.”
And that’s the difference. While Drake is locked into his business model, Kanye wants it all—even if it leads to future disputes. A few extra bucks from EMI and Roc-a-Fella might validate Kanye’s rights as an artist, allow him to take a vacation that EMI can’t track his PTO days, and push hip-hop forward. But it feels like the Louis Vuitton Don will be in a similar situation again sooner rather than later.
Earlier this week, I tweeted that I write for the folks who bought polyphonic ringtones on Cingular that sounded nothing like the actual song. I’d like to dedicate this week’s story to y’all. Those days were rough… this is what 50 Cent - In Da Club sounded like! We made it out though.
Check back next week to see who the next Trapital story gets dedicated to!