With new claims about a leaked album and millions in unpaid money, Megan Thee Stallion’s years-long battle with record label 1501 Certified Entertainment is getting even uglier. To understand where things stand, Billboard chatted with the lead attorneys for both sides – and they didn’t mince words.
The “Savage” star has long been at odds with the label over a record deal she calls “unconscionable,” but things heated up further this week when Megan filed a new complaint seeking more than $1 million in damages and suggested 1501 might have leaked her recent album Traumazine.
The two sides have already been battling in court for more than two years, but if the attorneys for both sides are any indicator, this fight isn’t ending any time soon.
“This is indentured servitude,” said Megan’s attorney Alex Spiro, a litigator at the elite law firm Quinn Emanuel who also represents Jay-Z and Elon Musk, in a phone interview with Billboard this week.
“I look forward to a time when I will have Megan under oath in this case,” said 1501’s lead counsel Steven Zager, who hails from the equally-prestigious firm King & Spalding, in a separate call.
BITTER BACKGROUND
The star rapper (real name Megan Pete) has been at odds with 1501 for more than two years now, claiming owner Carl Crawford duped a young artist into signing an “unconscionable” record deal in 2018 that was well-below industry standards. She says that when she signed a new management deal with Jay-Z’s Roc Nation in 2019, she got “real lawyers” who helped her see that the deal was “crazy.”
1501 strongly denies those allegations, arguing Crawford “discovered, developed and fully financed” Pete’s early career and gave her “substantially more” than was typical for a new and unknown artist. The label says Pete and Roc Nation are merely using baseless litigation as a vehicle to escape a deal she “no longer likes.”
Since 2020, that core dispute over a record deal has now manifested itself in several different legal skirmishes.
It started as a fight over whether 1501 was unfairly blocking Pete from releasing music. In March 2020, she sued and won a temporary restraining order from a judge allowing her to release her EP Suga; in 2021, she won a similar order in the same case greenlighting the release of a remix of the BTS song “Butter,” on which Pete was a featured artist.
That first case ended in a confidential settlement that saw 1501 amend the terms of Pete’s record deal, but earlier this year a new battle erupted over whether her 2021 release of Something for Thee Hotties counts as an “album” – a key distinction, since she must produce three albums under her record deal. In her complaint, Pete claimed 1501 was intentionally mislabeling Hotties to keep her unfairly locked into the deal for one more album.
1501 quickly countersued, arguing Hotties clearly didn’t meet the legal definition of an album under the new deal she had re-negotiated to settle first lawsuit. Seeking at least $1 million in damages from Pete, the label said that Hotties contained just 29 minutes of new material and had not been pre-approved by the label.
Now things have ratcheted up again. In a new, amended version of the lawsuit filed earlier this week, Pete tacked on her own demand for at least $1 million in damages from 1501, arguing the company had “systematically failed” to pay enough royalties and had “wrongfully allowed for excessive marketing and promotion charges.”
More salaciously, Pete also implicitly accused the label of leaking her album Traumazine. The complaint didn’t directly claim 1501 was behind the leak, but pointedly noted that it “occurred within only a few days after” she sent it to the label. Pete said 1501 has “not taken any action to help investigate” and that she’d been “forced to hire forensic investigators” to figure out how it happened.
DAMAGES DEMAND
According to Pete’s attorney Spiro, the updated version of the lawsuit – and specifically the demand for monetary damages – was necessary because it has now become clear that 1501’s alleged wrongdoing exceeds merely misclassifying Hotties to keep her locked into the deal (though those claims are also still pending).
“The more that we’ve learned, the more that we believe that money has not been accounted for or redistributed properly,” Spiro said. “And this is just the tip of the iceberg. Once we get into depositions, we expect it to grow.”
“We’re going to very aggressively take depositions, seek accounting for all the money they sucked out of this, and end it once and for all,” Spiro said.
But for 1501’s lawyer Zager, this week’s revamped allegations against 1501 were simply a ploy to “get the media’s attention” – a forum in which he says Pete and Roc Nation prefer to fight the ongoing dispute. He cited the number of articles that came out this week highlighting the damages demand: “She’s happy to try this lawsuit in the media, where she doesn’t have to swear to anything.”
As to the actual money at stake in the case, each side is now suing the other for damages, with each seeking “at least $1 million.” But such totals at the beginning of lawsuits are boilerplate estimates, and the actual sum due to either side will be heavily litigated as the case moves forward.
When the dust settles, Zager says he has “complete confidence that Megan owes us a whole lot more money than we owe her.” Spiro responded to that suggestion with a one-word answer: “nonsense.”
LEAK LITIGATION
Even more notable than Pete’s demand for damages was her implicit accusation that 1501 played a role in the Aug. 4 unauthorized release of Traumazine, which officially debuted last week and is currently sitting at No. 4 on the Billboard 200. In her new complaint, she says the leak came just days after she handed the album over to 1510, and that it forced her to release the album early to avoid “lost earnings, lost chart position, and lost data.”
Asked about the new accusation, Zager flatly denied it – saying there was no evidence to support the claim and, just as importantly, no motive for his client to try hurt the sales of an album from which it stood to take a portion of the profit.
“To her credit, she hasn’t come right out and said we did that,” Zager said. “She’s said we did everything else. I think she thinks we probably killed Kennedy.”
“But why would we do that?” Zager continued. “We make money when Megan makes money. If, as she believes, we leaked this album to harm her sales, we’d be cutting off our nose to spite our face.”
As the case moves forward, Spiro says he and his team have “every reason to believe” their accusation was correct and that they will “get to the bottom of this” by aggressively hunting down whoever was behind the leak. They’ve already asked the court to force Warner Music Group to hand over documents they think might help uncover the culprit.
As for motive, Spiro rejected the argument that 1501 lacked a reason to leak the album.
“Their motive is control, and they’re not a well-run entity to begin with,” Spiro said. “When that’s your motive and you’re not well run, you do things like this if you think it allows you to get the upper hand.”
BATTLE AHEAD
In the months ahead, the case will move into discovery (the legal process in which each side turns over of documents and other information to their opponents) and depositions of the key players, including Pete, Crawford and other 1501 execs. Both sides have filed motions over the past week seeking such depositions, though how and when and the extent to which those sit-downs happen is already being fiercely disputed.
After that process is complete, each side will likely ask the judge to rule on their accusations. If the judge declines to do so, the case will head for a trial before a Houston jury, which would eventually issue a verdict – on who owes money to who, on whether Thee Hotties was really an “album,” and potentially on the leak.
For Spiro, even after the new allegations, the case is still about the same basic problem: A talented young artist who was taken advantage of by a record label: “They’re trying to suck every possible inch of value they can pull out of this, even though they have no right to do so,” he said. “We’re moving to end this once and for all and give her her freedom back.”
Zager, on the other hand, says that narrative will change once the case is actually in a courtroom.
“I don’t think there are any reasonable people who would agree that Something For the Hotties is an album once they see the definition of ‘album’ in that contract. It’s all almost silly,” he said. “It’s very easy to go to the press for two years and say whatever is on your mind. When she has to take an oath to tell the truth, we’ll see how much of what she’s been saying to you folks in the press still stands up to scrutiny.”
