Working Class Action from p17 The lawsuit was settled in late October 2020. with final approval of the class settle- ment in late June, after the trustees made sure the money was distributed to the thou- sands of musicians who were on their un- claimed list. They had to ensure both union and nonunion members were getting paid, but also established a better framework for distribution. Until then, the system seemed to be that money would be retained until someone decided to claim it. Stefanie Taub, who declined to comment, took over as CEO of the AFM & SAG-AF- TRA fund a couple of months after Zukoski and Mandel filed the class-action lawsuit. Prior to that she served as a trustee of the fund for about six years. Now Zukoski and Mandel are trying to spread the word to let other non-featured performers know that they may be owed money too. “Hopefully, their marketing efforts in the future will make more session musicians aware of this fund and go collect their money,” Mandel says. “Part of the reason we wanted to publicize the results of the settle- ment is because it’s another opportunity to get the word out to these folks who might now still be entitled.” It all started with a phone call from a re- nowned harmonica player. Paul Harrington, who lives in Rockwall, had contacted Zu- koski a few years ago to find out about royal- ties he believed he was owed. Harrington had played on Pitbull’s “Tim- ber” song in the mid-2010s and, Zukoski says, came up with the hook of the song, which is part of the reason he says it was such a big hit. The song was everywhere. You’d hear it at Dallas Cowboys games, on the radio, on TV. “That’s kind of a testament to his talent,” Zukoski says of Harrington. The Observer couldn’t reach Harrington for comment. After contacting the fund, Zukoski re- ceived some paperwork that showed Har- rington was owed money and eventually received a five-figure check for the musician. “At that point I realized there is a much bigger problem and made some informal at- tempts to get the funds to change its ways because people aren’t being paid, but I ran into a brick wall,” Zukoski says. He wasn’t familiar with class-action law- suits, but came across Mandel, whom Zu- koski calls “the preeminent class-action lawyer in Dallas.” Mandel says he has won and settled many class-action lawsuits in the past since it’s often cheaper for the defen- dants to go that route rather than risk a jury trial. He’s been named a “Texas Super Law- yer” for several years by Texas Monthly and listed in the Top 100 Trial Lawyer and Top 25 Class Action Trial Lawyer lists by The Na- tional Trial Lawyers organization since 2013. If anyone could get Hair and the other trustees to fix the broken system, Mandel would. As part of Jeeves Mandel Law Group in Dallas, he’s been taking on giant corporations for 25 years in cases over consumer insurance, securities and breach of fiduciary duties. Mandel says his passion lies in helping or- 182 dinary people get justice in cases of abuse by large corporations. In this case, the ordinary people were the non-featured performers. Mandel and Zukoski discovered that the fund was sitting on an undistribued $45 mil- lion, mostly allotted for non-union, non-fea- tured performers, they say. In late 2017, they filed a lawsuit against Hair and others and amended it in early February 2018. “They didn’t care if non-union people got paid and didn’t do a good job for union peo- ple,” Mandel says. “... The trustees had breached their fiduciary duties by not iden- tifying non-union performers and not ade- quately distributing the money. I thought it was a perfect class action because basically they were breaching everybody and doing a terrible job.” According to the early February 2018 lawsuit, after the digital laws passed in the ’90s, performance royalties became payable at 50% to copyright owners of the sound re- cordings, 45% to featured artists, 2.5% to non-featured musicians and 2.5% to non- featured vocalists. Mandel and Zukoski pointed out in the lawsuit that SoundExchange, as the repre- sentative of the copyright owners of sound recordings, and the AFM had appointed a fund to receive royalties from SoundEx- change and distribute them to the non-fea- tured musicians. But SoundExchange took the position that its only obligation was to remit the royalties to the fund but it had no obligation to audit or ensure that fund trust- ees, three of whom were from the SAG-AFTRA and three from AFM, were paying those royalties. “This has left the trust- curity numbers or taxpayer identification numbers. Yet the fund had their contact in- formation but never contacted them, ac- cording to the lawsuit. Zukoski says that the fund could have contacted the record label, producer, fea- tured artist or featured artist’s management because one of them would have hired and paid the non-featured performer for their work and would have payroll and IRS re- cords available. The lawyers also argued that the trustees failed to engage in a reasonable, good faith marketing campaign to alert the thousands of musicians on the unclaimed royalties list that they were owed about $45 million, which is the sole purpose for the fund’s exis- tence, according to the lawsuit. “The failure ... cannot be considered any- thing other than a bad faith refusal to pay royalties by the trustees,” Zukoski wrote. Chaz Marie blames Hair, who’s been serving as the national president of the AFM for 10 years. “The union was set up to protect every- one,” Marie says. A couple of years ago, Hair had ap- ees free from any over- sight over the payment of royalties pursuant to (…) the trust agreement,” Zu- koski wrote in the lawsuit. “Each year thousands of sound recordings are digitally performed, and each year SoundExchange collects roy- alties on thousands of songs, which royalties are remitted to the fund. Tens of thousands of non-featured performers perform on those sound recordings which are digitally performed each year.” It seems the trustees had a greater suc- “THEY DIDN’T CARE IF NON-UNION PEOPLE GOT PAID AND DIDN’T DO A GOOD JOB FOR UNION PEOPLE.” - ATTORNEY ROGER MANDEL proached Marie’s husband, guitar tone king Quinten Hope, Marie says, and went off on him about Marie being part of a class-action lawsuit against Hair. She questioned how he could let this happen under his watch. “He got busted, got caught doing some- thing bad,” Marie says. “We did get a big settle- ment out of it. No musi- cian shouldn’t have to be paid.” The Observer con- tacted Hair, but he re- fused to discuss the issue. “I’m not dignifying their comments with a re- sponse,” he said, twice. “I will not dignify their comments with a re- sponse.” Instead, Hair told the Observer to contact the CEO of the SAG-ATFRA fund to discuss what happened, why it happened and what’s been done about it. Taub declined to comment. The royalty payments began arriving cess rate at distributing royalties to non-fea- tured performers who belonged to the AFM union, according to the lawsuit, because they had made arrangements with the unions and assisted them with their identifi- cation efforts to receive their royalties. “For non-union, non-featured perform- ers, the trustees have not attempted to make arrangements with entities that could sys- tematically collect such information regard- ing non-union, non-featured performers and provide it to the fund,” Zukoski wrote in the February 2018 lawsuit. The situation had gotten so bad that the fund was researching and distributing royal- ties years behind schedule, they say. Zukoski says that there was a rule that if the funds weren’t collected by non-featured perform- ers in 60 days, the money reverted back to the fund. “But they say they weren’t going to keep it,” he adds. The trustees also had an Unclaimed Roy- alties List that contained thousands of non- featured performers who couldn’t be paid because the fund didn’t have their Social Se- during the COVID-19 pandemic when mil- lions of musicians were out of work, Marie and Zukoski say. “What makes us proud is the money was distributed during COVID,” Mandel adds. “For musicians who could no longer gig and who couldn’t do studio work it was a real blessing.” Deadline reported in April 2021 that some 500,000 session musicians and background singers like Marie were sharing more than $70 million in royalties that hadn’t been dis- tributed. The publication called it “the larg- est distribution in the fund’s history.” Sidney Kibodeaux White, the fund’s chief operating officer, told Deadline: “Every year, we’ve been able to collect more revenue on behalf of our participants. Given the enor- mous impact the pandemic has had on the ability to earn a living on both instrumental- ists and vocalists, we are thrilled to be able to assist non-featured performers by collecting and distributing royalty income they might not know they’re entitled to receive. Unlike other rights collectives, there is no member- ship or registration requirement in order to qualify — as long as a musician participates as a non-featured performer on a covered sound recording, that musician is considered a ‘par- ticipant’ for distribution purposes.” What she failed to mention was that the year before, in March 2020, they had settled Zukoski and Mandel’s class-action lawsuit, which Mandel said required them to change their practices. According to the March 2020 settlement agreement, “as a result, the Fund will be pay- ing 100% of those Unclaimed Royalties from 2011 to 2016, over $45 million, to over 60,000 Class members by April 30, 2022. In addition, the injunctive relief will ensure that a much higher percentage of over $150 million in royalties collected from 2017 to 2019 will be distributed to the NFPs to whom they are owed and will ultimately be paid out 100% rather than held indefinitely by the Fund as occurred in the past. This represents recovery of 100% of the mone- tary relief Plaintiffs sought and potentially could have recovered.” Taub claimed that the $70 million dis- tributed in April 2021 wasn’t part of the class-action settlement, but it’s hard to argue that the distribution wasn’t indirectly af- fected by the class-action lawsuit. Mandel says the fund’s trustees had to take specific steps to identify, locate and pay non-fea- tured performers as well as hire a manage- ment consultant to revamp their business and hire a marketing consultant to get the word out to all these unpaid musicians. According to the June 29 declaration of Stefanie Taub, “the fund has taken all steps necessary to comply with the Settlement Agreement.” In late April, the fund distributed nearly $3 million that was owed from 2011 to more than 13,000 artists; $3.5 million from 2012 to 13,761 artists; $7.7 million from 2013 to 15,846 artists; $9.6 million from 2014 to 14,605 art- ists; $10.2 million from 2015 to 16,712 artists and $10.6 million from 2016 to 17,921 artists, Taub wrote in her late June declaration. “Ultimately, they did the right thing and distributed this money,” Zukoski says. “They distributed every penny they had on hand and agreed to procedures going forward to make sure they distribute the funds.” In some ways, this lawsuit was personal for Zukoski. He’s played on two full-length albums as a session bassist for a multi-CMA and Grammy winner, on recordings with two Blues Foundation Award winners and on dozens of radio and TV recordings. He’s also the former president of The Texas Mu- sic Project, a nonprofit that helps raise funds for music education programs in Texas. “As a player, I’d never met a single music colleague who had been paid the royalty and not a single one knew about it,” he said. “Our goal was to make sure they get paid as musi- cians and to be aware that they were entitled to money.” Marie was elated when the trustees agreed to the terms of the lawsuit. She says she couldn’t believe it and was happy to re- ceive the money when it arrived. “I’m glad I got involved in it,” she says. “Yes, we got them, and not that we want to shame someone, but Ray made his own choices and put bad stuff out there, and it comes back to you. Karma is a bitch.” MONTH XX–MONTH XX, 2014 AUGUST 25–31, 2022 DALLAS OBSERVER DALLAS OBSERVER | CLASSIFIED | MUSIC | DISH | MOVIES | CULTURE | NIGHT+DAY | FEATURE | SCHUTZE | UNFAIR PARK | CONTENTS | CLASSIFIED | MUSIC | DISH | CULTURE | UNFAIR PARK | CONTENTS dallasobserver.com dallasobserver.com
