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Universal Accused Of Racketeering

LOS ANGELES (CelebrityAccess MediaWire) — Two independent music promoters have sued Universal Music Group, claiming that the record company forced them to submit false invoices so Universal could recoup promotional costs from artists such as Rapper Nelly.

National Music Marketing of Los Angeles and Majestic Promotions of Atlanta are asking for $100 million from the company in the suit, according to Reuters.

The suit raises issues similar to the “pay-for-play” concepts being probed by New York Attorney General Eliot Spitzer in a wide-ranging investigation. Spitzer is looking into the legality of record companies paying radio stations to play their songs.

“What (Universal) was doing was defrauding their artists — some of their biggest artists,” plaintiffs’ lawyer David J. Cohen told Reuters. “I’m sure (rapper) Nelly is not going to be happy that they were taking money out of his promotion budget to pay for promotions for other artists — money that he had to pay back form his royalties.”

The lawsuit said that when National and Majestic refused to submit fraudulent promotions invoices, Universal fired them and radio stations to avoid doing business with them. Cohen said that Universal drove National out of business and Majestic is “hanging by a thread.”

The suit accuses UMG of racketeering, fraud, trade libel and breach of contract. –by CelebrityAccess Staff Writers