Sophia Michaels
Honoring the second anniversary of Lil Peep’s death this past November were, among other things, a documentary, a pop-up merchandise store, and a full-length posthumous album commemorating the young rapper’s short-lived career. But looming over all those projects is a legal question about the circumstances of Peep’s death — and the music industry’s role in it.
Lil Peep, real name Gustav Elijah Åhr, died on a tour bus in Tucson, Arizona, in November 2017. Åhr had just celebrated his 21st birthday; his particular brand of intimate, emo-studded rap was eliciting favorable critical comparisons to Kurt Cobain and propelling him up the music charts. Medical examiners ruled his death as an accidental overdose of Xanax and fentanyl. In October 2019, Åhr’s mother Liza Womack filed a lawsuit against First Access Entertainment, the management and label services company that signed the rapper to a multi-year contract in 2016, claiming that it played a part in her son’s death — specifically, by allegedly pushing him “onto stage after stage in city after city, plying and propping him up” with illegal drugs and having him sign an “asymmetrical joint venture business enterprise” in which the company also breached contract on multiple counts.
First Access Entertainment is now disputing all claims, including negligence, breach of contract, and wrongful death, according to documents filed on December 23rd in Los Angeles Superior Court and reviewed by Rolling Stone.
Attorneys representing FAE Limited and FAE LLC — the U.K. and U.S. operations of the music company, respectively — state in a 44-page filing that, under the contract that the company signed with Lil Peep, FAE was never legally responsible for the rapper’s well-being, citing precedents like the 2013 case by Michael Jackson’s estate against AEG Live as examples of music companies’ limited scope of responsibility in their artists’ personal conduct.
Relationships between Lil Peep and FAE were “purely of a business nature and not the type of special relationship giving rise to an independent duty of care for one’s safety and/or well-being,” FAE claims in court documents.
FAE CEO Sarah Stennett has, in the past, claimed a personal interest in her client Lil Peep. “I felt very protective of him from day one,” Stennett told Rolling Stone earlier this year. But in last week’s response to Womack’s lawsuit, FAE repeatedly stresses that their relationship with Lil Peep was a strict “arms’ length business arrangement,” as constituted in their joint venture agreement.
FAE’s response points to a clause of the joint venture agreement that states that “each party is responsible for its own actions and will not be jointly and severally liable for the actions of the other Party.” The company’s “relationship with Mr. Åhr was purely contractual and purely business,” FAE’s lawyers write. “The JVA does not cover personal or protection services to Mr. Åhr, nor does it cover managing or controlling his personal life, including his use of drugs.”
But on Monday, December 30th, a week after First Access filed its response, Womack filed an amended complaint that fires back at the label’s claim that its business agreement with Peep was “arm’s length” in nature.
Womack’s new documents say that FAE “undertook the task of controlling and managing [Peep’s] personal life,” including his “eating, drinking, sleeping, allowing for his personal hygiene, procuring driver’s license/identification cards…living arrangements, buying and providing furniture, co-signing leases, securing and paying for utilities, money management, budgeting, paying taxes, identifying, paying for, transporting, and accessing health care providers and therapists, exercise, social activities, drug use, personal safety, and well-being.”
“Any type of contention that this was a mere business agreement flies in the face of the multitude of facts that say otherwise,” Womack’s lawyer, Paul Matiasic, tells Rolling Stone.
Peep and FAE signed the contract at the heart of the dispute — which Rolling Stone has obtained and reviewed — in August 2016. It details a 50-50 split between the rapper and FAE of “all rights of whatever nature, including but not limited to intellectual property rights” arising from Peep’s activities and products. Upon net profits reaching more than $5 million, the split would shift to 60% in the artist and 40% in FAE, and it would further escalate to 65% in the artist and 35% in FAE after net profits crossed the $20 million mark, according to the contract, which establishes a joint-venture agreement between the two entities. FAE also paid Peep a $35,000 advance and $300,000 for recording, tour support, marketing, and brand development.
Such terms aren’t uncommon between young artists and companies that offer a full suite of record-label services — but the question of whether labels actually provide all those services is where things get murky, according to several managers and music lawyers who work on artist contracts. Artists aren’t usually aware of whether or not a company is over-promising on resources in order to claim the coveted 50-50 split of rights ownership, and especially not if they’re young acts unfamiliar with the music industry.
“It’s a tough pill to swallow, granting ownership interest in your masters to a management and label services company,” John Seay — an Atlanta-based entertainment lawyer who represents artists in contract negotiations — told Rolling Stone in October when Womack first filed the lawsuit. “So do [the companies] actually do these things? What’s their track record? If someone’s rendering traditional management duties, they’d typically get 15% to 20% of the artists’ adjusted gross profits and no copyright ownership. But managers all the time claim they’re not just managing but doing PR and other label services. [If that’s the case,] the problem is that so many companies don’t actually do that — so it’s not really a justified 50% for them to take.”
Seay added that the structure of Peep’s deal as a joint venture “raises red flags and should inspire very close scrutiny.” While JVs can be a good way to double a project’s publicity potential or show a certain brand alignment — Meek Mill recently signed a JV with close friend Jay-Z’s Roc Nation, for example — they can often be financially worse for young artists than traditional record-label deals would, because of the need to split profits evenly with another entity.
As the music industry continues its gold rush for young new artists fresh out of SoundCloud and other DIY platforms, joint-venture offers are increasingly common, according to other managers and lawyers. “It’s an easy way to structure deals and optically change the narrative,” says music strategist Dan Feldstein. “It’s a PR tactic that adds some kind of business credibility to the artist and makes them seem like more than they are. You instantly get more press and attention.”
Feldstein’s partner Amir Kashani, with whom he runs the consultancy Salt+Vinegar, adds: “We typically do not advise a JV. People come from all walks of life and different circumstances and some people need infusions of cash to make something — but sadly, where you start with a JV is relinquishing the rights on the IP. The one question that I ask people who are offered one of these JVs is, ‘What does the dollar cost? What is the value of this money exchanged in this deal?’ Let’s say a JV is valued at $1 million; what do you have to return for it to be even? That’s not even spoken about. These are not an even swap. Shouldn’t the artists know what it costs?”
“Maybe there are circumstances that [a split like Peep’s] makes sense,” John Strohm, a former musician and music lawyer who now presides over Nashville’s Rounder Records, told Rolling Stone in October. “But a lot of the times, the deals I saw — there were lots of deals where people didn’t have a lot to offer on those terms.” Strohm says that the deals he sees in the hip-hop space nowadays are similar to what he saw in the Nineties-era gold rush in the rock world: “It has to be value for value,” he says. “If you’re just making money from the artist, it’s textbook exploitation.”
FAE itself is a joint venture between music manager Sarah Stennett and Access Industries, the multinational conglomerate run by Len Blavatnik that also owns Warner Music Group. (In March 2019, Stennett’s attorney also told Rolling Stone that FAE was Peep’s label and not his management company, and that although Stennett gave the rapper personal support, it was not in the context of a management relationship.)
But even if the company was operating solely as Peep’s label, it did not fulfill its duties as one, according to Womack’s lawsuit. The suit alleges that FAE breached the joint-venture agreement by, among other things, “failing to act in good faith; exercising sole and exclusive management and control over the joint venture, and usurping the direction of Decedent’s musical career, recordings, and live performances for the purpose of maximizing Defendants’ profits of the joint venture; and failing to account and distribute to Decedent his share of the total joint venture profits.”
In their response filed last week, FAE’s lawyers argue that Womack’s lawsuit fails to demonstrate any breach of contract. The company says that the lawsuit “does not allege facts to support a breach of the JVA,” that it failed to demonstrate that Lil Peep had even held up his end of the JVA (“In fact,” writes a FAE lawyer, “the Complaint concedes that Mr. Åhr at times failed to uphold his contractual obligations”), and that any alleged breach of contract had no relation to Lil Peep’s death.
“There simply is no connection,” FAE’s lawyers argued in a demurrer filed in court last week, “between Mr. Åhr’s overdose from the combined toxic effects of fentanyl and alprazolam — drugs that Plaintiff does not and cannot allege FAE Ltd. supplied to Mr. Åhr on the day he died — and the Complaint’s bare allegations that FAE Ltd. exerted ‘exclusive control’ over the Joint Venture, usurped the direction of Mr. Åhr’s musical career to maximize the profits of the Joint Venture, and/or failed to properly account for and distribute Mr. Åhr’s share of the net profits.”
The ongoing legal tussle is as much about Lil Peep as it is about how much the music industry owes to the young stars it shuttles to the spotlight. From the beginning, Womack’s lawsuit against First Access Entertainment has posed a question about the nature of relationships between 21st-century label services companies and their artists. In their response, First Access Entertainment argues that Womack’s lawsuit, if successful, would place an undue burden on the liability of entertainment companies, citing past court decisions that have found universities not liable for its students’ harmful use of alcoholic beverages.
“Given [the] realities of modern college life, the university does not undertake a duty of care to safeguard its students from the risks of harm flowing from the use of alcoholic beverages,” wrote FAE’s lawyers, quoting from a 2018 California Supreme Court decision. “The same rationale applies here.”
“Mr. Åhr’s drug overdose would extend the boundaries of legal obligations far beyond any precedent, and far beyond the contractual obligations and reasonable expectations of parties doing business,” FAE’s lawyers argue. “It would convert businesses engaged in the music and entertainment industries into full-time babysitters for artists.”
The unsettled case is also taking place amid a flurry of renewed public attention on Peep’s life and career. A month ago, the documentary film Everybody’s Everything — which chronicled the rapper’s legacy through dozens of interviews with people who knew him best — hit theaters; the project lists Womack, Stennett, and Terrence Malik — a personal friend of the Peep family — as executive producers, although the film’s two co-directors, Sebastian Jones and Ramez Silyan, say Womack and Stennett did not interact much during the production.
“There was always tension between them,” Silyan told Rolling Stone earlier this year, adding that it was not a “huge surprise” when Womack filed the lawsuit last month. “It was pretty obvious that they didn’t get along very well. I see how it becomes this sort of thing, even though that’s not part of the narrative of the film,” he said.
Accompanying the project’s release was an album from Sony’s Columbia Records, also titled Everybody’s Everything, but produced separately, comprising a 19-track “lovingly curated collection of songs from Lil Peep’s career, including fan favorites that have never been available on all platforms, and songs that have never been released in any form.” To celebrate the release, the label held a one-day Lil Peep pop-up store in New York City, selling merchandise such as T-shirts and beanies. Online merchandise purchases are being run through LilPeep.com, which is operated by Womack and Peep’s brother Oskar.
FAE’s lawyers did not respond to multiple requests for comment. According to court documents, the trial date for the case is currently set for April 5th, 2021.
Featured via: Rollingstone
