The record industry battle between upstart TVT Records and mammoth Island Def Jam/Universal took an odd twist this week. TVT was slammed in the New York Times even as the clock ticks on Def Jam's possible appeal of its $132 million judgment.
Monday's Times article by business reporter Lynette Holloway spins TVT as a loser outfit and gives a lopsided look at the company's financial situation. The story was also riddled with errors, according to a press release issued by TVT.
The problems stem from the Times reporting on a $23 million loan TVT obtained in 1999. Owner Steve Gottlieb used 5 percent of the company's back catalog as collateral in what was then called a securitization or a "Bowie Bond." Prudential Securities put up the money. But Prudential claims TVT has defaulted on the loan, and has been trying to foreclose on it for about a year. Just the loan, not the whole of TVT.
Just the 5 percent. Got it?
Apparently the Times didn't. In Monday's paper, Holloway declared that Gottlieb had lost control of TVT and that Prudential was now shopping TVT to new buyers. This was in the New York Times, so maybe people believed it. It is, however, untrue.
In fact, Gottlieb is very much in control of TVT. Prudential does not own it, isn't in charge of it, and isn't selling it. A Prudential source said to me yesterday: "When I saw that story in the Times, I thought, 'That's interesting. How can we sell something we don't own?'"
In fact, in February, Prudential was denied the right by a judge even to foreclose on the assets that had been used as collateral by TVT. And that was just a few soundtracks, etc, all from 1999 and earlier. Somehow the Times missed that.
Holloway wrote: "If Mr. Gottlieb is not able to wrest back control of his company . . . he will have to move on without TVT's acts."
Charles Koppelman, the record industry veteran who oversaw the securitization in 1999, told me: "That's just wrong. For one thing, it was all about existing assets and nothing in the future." In other words, the Prudential loan does not apply to TVT's current acts.
But Holloway seems either to not have listened or not have asked questions for which she needed answers.
According to my Prudential source, no one from the Times called Prudential to ask if any of this was true or to check facts.
The original slant of the story, I am told, was about the smallish TVT taking on the gigantic Def Jam in the Ja Rule suit.
Times spokeswoman Catherine Mathis e-mailed me this statement yesterday when I queried her about the matter: "We are reviewing the article to determine whether corrections are warranted." A few hours later she reported that there would be a correction, but she didn't know when it would be published.
It seems more than a few corrections are warranted. Not only did Holloway get the securitization thing wrong, she also says TVT made rapper Snoop Dogg one of their artists. He is not a solo performer there, although he has produced records on the label.
Holloway also got wrong the story of the TVT-Def Jam lawsuit, which was reported here a couple of weeks ago along with much lively dialogue from the hearings. Holloway makes it seem like the record Gottlieb was going to put out was just old tracks from Ja Rule. But they were all re-recorded and modernized.
Holloway also states that Def Jam never agreed to let TVT put out the Ja Rule CD, then known as Cash Money Click. But the entire case was based on a side letter agreement issued by Universal Def Jam to TVT allowing them to issue Ja Rule's record. It was Lyor Cohen's indecisiveness and fear of upsetting Ja Rule and partner Irv Gotti that caused Def Jam to embark on a losing lawsuit.
So what's happening? Where is the spin coming from? Right now the clock is ticking on Cohen and Def Jam. They will have to post a bond for the full amount in the TVT lawsuit -- $132 million -- if they want to appeal the decision. As well, Cohen is fighting for his life at Def Jam, where he's supposedly in contract renegotiations of his own.
This week, former Sony honcho Tommy Mottola was added to the Universal game plan in case Cohen leaves, or is evicted. Showing TVT in a negative light would at least wear the company down, some might think. But there's more to come in this saga. A lot more.
This week, according to the Daily News, Def Jam filed a suit against TVT, claiming that if they release the Ja Rule/Cash Money Click album it will somehow harm Universal's Cash Money Records label.
The two have nothing to do with each other, but Def Jam -- Cohen in particular -- is desperate to save face over the $132 million loss.
The games continue, prices of CDs keep going up, and sales continue to plummet. Can't anyone do the math?
The Italian ad man Graziano Uliani is so nuts about Memphis soul music that he made the town fathers in Porretta, Italy change his street name to Via Otis Redding. I kid you not.
Last weekend, for the 16th year in a row, Uliani brought American soul music to the charming village of Porretta in the Emilia-Romagna region of Italy. Soul music has put Porretta on the map, even more than the local spa and healing waters that attract elderly Italian ladies from as far away as Puglia, in what's known as the "boot" of the country.
What makes the Porretta Soul Festival so interesting is that the people of Porretta have little interest in it. Even though a bunch of black musicians from Memphis, Tenn. pour into their village every year around July 3, the Porrettans go about their business with blissful ignorance. Soul music is Uliani's peculiar obsession. The rest of the town puts up with it.
So they came this year as always, and I went to watch the proceedings because the great Carla Thomas was scheduled to perform with her brother, Marvell and sister Vaneese. They were backed by the Memphis All-Stars.
The other performers on the weekend bill were novelty act Solomon Burke, up and comer Ellis Hooks, Memphis singer Jackie Johnson and ex-pat soul man Charles Walker who lives in Italy and performs with a band out of Britian.
On Saturday night July 5, the Thomas family indeed put on a little show in Rufus Thomas Park, a new amphitheatre built behind the Hotel Roma and named for their dad, the R&B legend who passed away in December 2001.
Uliani, you see, is also obsessed with the Thomases and with Memphis soul. He gave each of the Thomas children plaques and made them Porretta's stars of the year. The show's emcee was a Brit who spoke in halting Italian.
Carla, who does not perform that often anymore, did spine tingling versions of her own hits "Gee Whiz (Look at His Eyes)" and "B-A-B-Y." She knocked out similar renditions of "What the World Needs Now is Love" and performed a shout-out duet with her sister Vaneese on her old hit, "A Love of My Own." She even started her set with "Lovey Dovey," the big hit she had with Otis Redding right before he died in 1967.
The crowd gave Carla a long standing ovation, so Carla encored with Ann Peebles' "I Feel Like Breaking Up Somebody's Home." Later Carla, who laid down a hot groove despite her innate sweetness, said, "I feel bad when I sing that song. But I like doing it."
The show would have been enough, but on Sunday morning Carla, Vaneese, their backup singers and Jackie Johnson took the stage at the Frati Cappuccini church in Porretta. This was something to see, considering the church, of course, is Roman Catholic and the ladies are Southern Baptists.
Gospel music is heard once a year in the church, and it's the single biggest day of the year for them. The stone building filled up right into the aisles. Marvell Thomas took over the organ and Jackie Johnson came forward to sing "Amazing Grace." There was just enough clapping to make it feel like home, but not so much that communion wasn't delivered in a timely manner.