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Okay, without being too vague, and without overwhelming detail, i'm gonna try and break it down:

About a year ago, my band kicked out our drummer shortly after recording a 5 song EP with a record label. Our contract says that for every 1000 CDs our label makes, we get 100 CDs for free. We agree to give our old drummer 25% of those CDs (or 25 CDs for the math impared). On top of these free CDs, we get CDs by buying them from the record label for $4.25 a piece. We then take those CDs and sell them at shows and on the road, etc. Now, our old drummer, named Josh, is claming that we owe him money. What josh wants is 25% of the profits off of every CD (on top of the 25 CDs we've already given him). Make sense? So basically if we sell the CDs we bought from the record label for $10, he wants 25% of $5.75 off of every CD we sell.

As for payment for sold CDs from the record label, we get paid once the recording budget is paid off. So if recording cost X number of dollars, once the label makes X number of dollars on that CD, we get a percentage of the profits over X. We agree to give him 25% of that money as well, so this money is not in question.

**My question is: is Josh legally entitled to 25% of the profits from the CDs that we bought with our own money and sold on our own time? I like to compare it to a store like Best Buy. If he called up Best Buy and said "Hi, you bought this CD that i'm on, and now I want 25% of your profits," would Best Buy be entitled to give him part of their profits? The answer to that question is obviously No.

Please, if you have any background in Law or the legal system, please please please post advice. He is threatening to sue us, and many people have told me that he has no case at all, seeing as we bought the CDs with our own money and sold them on our own time. Josh is really pissed at us and is now saying that the friendship is over which makes me crazy sad inside...

 
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i say advice, but i dont mean like true legal advice. i really just want opinions. sorry for any confusion.

 
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legally he is intitled to the 25% and 4 bucks nothing else.

Injen

 
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its a civil issue

 
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he should be happy he didnt spontentiously combust or asphixiate on vomit (someone elses)

Ya I was in a band, and ya I saw Spinal Tap WAY too many times

 
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what exactly do you mean? 25% of the CDs we buy? and what 4 dollars? sorry...i'm just confused haha

 
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I would assume that if you're selling CD's on which he plays, then he would have at least some legal rights to any profits made off of his work. So I would say he gets 25%, but only on the sales of CD's that he plays on. If you release another CD without him, he get's nothing of that one (obviously). I have no idea tho.

 
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I THINK you guys should be okay. Legally, he IS entitled to 25% of either real or potential profit. Here it is...as far as he is concerned, he is entitled to 25% of the primary payment, which in this particular situation is not money, but the 100 cds...physical property. So you give him 25 CDs, his share of the PHYSICAL property. You are not required to even sell the CDs...you could keep them all if you so chose. So the profit there is POTENTIAL, not automatic. Once you have given him the CDs, those other 75 are yours...he has no right to them, and thus no say in what you do with them. Based on the argument of intellectual property of artists, if he gets 25% of the profits from the sale of 75 CDs, then the rest of the band should by the same logic be entitled to 75% of the profits he may make from his 25 CDs. If would be the same if you instead sold all 100, and gave him 25% of the profits. If you sold 75 CDs for a buck apiece, with him getting no cut of that, you would make 75 dollars. If you sold 100 for a buck apiece, then gave him his 25%, you would again have 75 dollars. He can't have it both ways. In short, tell him to go fock himself.

As far as the CDs you guys buy, again fock himself. By the same logic, he could buy 100 CDs from Best Buy at full price, mark them up 4 dollars, sell them all again on ebay, and you guys would be entitled to 75% (3 of the four dollars of profit) of the profit. He would probably roll his eyes and laugh if you suggested that to him, so this is what you should suggest to him...go fock himself, and you'll see him in court if need be.

 
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well he is legally entitled to the money we recieve from our record label for CD sales. our contract states that once the recording budget is paid off by CD sales, we recieve a certain percentage of profits. So if recording cost $10000, and they sold $12000, we would get a percentage of $2000. He then gets 25% of that percentage of $2000. These are his royalty checks.

this is what we feel he is legally entitled to. why should he get a quarter of the money we make from buying the CDs with our money and selling them on our own time, when we have already admitted we owe him royalty checks?

 
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Eh, I thougt about this even more now that I am awake. You are fine. screw him.