A “fairness hearing” will be held on June 20 at the U.S. District Court in Atlanta to address a proposed settlement from AFTRA’s Health & Retirement Funds (AFTRA the Union is a separate entity) to settle a lawsuit that objects to the administration of benefits including the accounting practices of the Funds. Judge Clarence Cooper will determine whether the proposed settlement should be accepted. Recording artists including Sam Moore, representatives of the Recording Artists Coalition, and others including Dan Aykroyd will be on hand to voice their objections.
The proposed settlement calls for a payment of about $100,000 to each of 15 named plaintiffs if they agree to sign off on the settlement proposal, which would then bind all vocal recording artists as if they were a class. As many as 20,000 such artists (any singer, poet, comic or spoken-word artist who has made audio recordings in the United States prior to 1995) would be affected by the settlement. Each artist’s share could be as small as $200.00 and would release the trustees of the AFTRA H&R Funds of all breaches past, present and future regardless of their conduct should the settlement be approved. Several of the artists who vehemently oppose the settlement feel it does not address sufficiently the problems at the Funds, including under-paid, unmade or unpaid contributions from record companies to their health and retirement fund benefit accounts.
Joyce Moore, manager of Sam Moore (the lead Named Plaintiff in the case) and a key advocate on this issue says, “Sam strongly opposes this settlement and will not accept the cash carrot to sell off his signature in approval of a bad deal. This is a very serious matter affecting thousands of artists and their families. Health care benefits, life insurance and pension benefits and credits are at serious risk. There is no justification to release the Funds from their legal and moral obligations to the artists who they are chartered to protect as their fiduciaries.”
Alan Brunswick, a lawyer for the Recording Artists Coalition, says, “This is not a fight against record companies at this hearing. It’s about the AFTRA health and retirement funds’ failure to enforce the obligations of the record companies to make appropriate contributions on behalf of recording artists.” Industry veteran and Recording Artists Coalition force Irving Azoff describes the process as “a bureaucratic nightmare” and is endorsing a complete overhaul of the system, starting with this case.
The case was filed in 1993 to correct long-standing problems with AFTRA’s health and retirement funds. For years, the funds relied on voluntary compliance by the record company signatories. According to the plaintiffs in the lawsuit, this afforded the companies the opportunity to avoid or delay reporting and paying the appropriate contributions on behalf of the artist community.
By federal law (as set forth under the collective bargaining agreement between AFTRA and the record companies, known as the Phono Code of 1959), record labels are required to pay health and pension benefits to recording artists through the funds.
This is the same fund that covers television and radio artists and has an approximate value of over $2 billion irrespective of the millions and millions of uncollected or underpaid recording industry contributions.