Eminem's Company Wins Digital Royalties

During the early iTunes era, record labels sometimes applied physical-product deductions such as packaging and breakage to digital royalties, even though downloads required neither. Eminem's production company, F.B.T. Productions, sued Aftermath Records and other Universal Music affiliates in 2007, arguing that downloads and ringtones counted as licensed masters rather than record sales. That distinction increased F.B.T.'s contractual royalty from 12 to 20 percent of retail sales to 50 percent of Universal's net licensing revenue. In 2010, the Ninth Circuit ruled for F.B.T., and the Supreme Court refused Universal's appeal in 2011.

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