Linkin Park Auditor Can't Dodge Firm's Defamation Suit

[JZLP-Benningstrong]

By Sindhu Sundar

 

 

Law360, New York (January 24, 2013, 10:54 PM ET) -- A California appeals court on Thursday allowed Davis Shapiro Lewit & Hayes LLP to proceed with claims against an auditor whom it accused of defamation after he allegedly told rock band Linkin Park that the firm had botched royalty negotiations with Warner Brothers Entertainment Inc.

 

A three-judge appeals panel found that the auditor, Paul Hutchinson, did not show enough evidence that the contentious remarks in his report to Linkin Park were protected under California's anti-Strategic Lawsuits Against Public Participation law. The law guards free speech and the...

 

i need an account to read the whole thing. wtf is this?

 

www.law360.com/m/ip/articles/410032

[RogueSoul]

Intense

[Pez]

Interesting. I wonder what the full backstory is.

[michalangelo]

user Heloisa posted this on lpcollectors fb group:

 

Law360, New York (January 24, 2013, 10:54 PM ET) -- A California appeals court on Thursday allowed Davis Shapiro Lewit & Hayes LLP to proceed with claims against an auditor whom it accused of defamation after he allegedly told rock band Linkin Park that the firm had botched royalty negotiations with Warner Brothers Entertainment Inc.

 

A three-judge appeals panel found that the auditor, Paul Hutchinson, did not show enough evidence that the contentious remarks in his report to Linkin Park were protected under California's anti-Strategic Lawsuits Against Public Participation law. The law guards free speech and the right to engage in government and civic affairs.

 

The court found that Hutchinson had not shown enough evidence that his remarks were protected by the litigation privilege. Although he had argued that he had thought his statements may be used in litigation by the band against former Davis Shapiro attorney Daniel Hayes, there was not enough evidence to show that the band had such intentions, the opinion said.

 

“We are pleased that the court has affirmed the trial court’s ruling denying Hutchinson’s special motion to strike,” said Lawrence Y. Iser of Kinsella Weitzman Iser Kump & Aldisert LLP, an attorney for Hayes and the law firm. “Although the court did not have to reach the merits of the case to conclude that the allegations are not subject to California’s anti-SLAPP statute, we believe the evidence presented to the trial court overwhelmingly establishes that the plaintiffs will prevail against Hutchinson in their claims for defamation, trade libel and intentional interference with contract.”

 

While he was a partner at Davis Shapiro, Hayes had represented Linkin Park, including in negotiating a 2002 recording agreement between the band and Warner Brothers. The agreement held that Warner Brothers could alter how royalties would be calculated, as long as it did not harm the royalties that the band was paid under the agreement, according to the opinion.

 

Warner Brothers then set out to change its calculation of royalties in May 2003, demonstrating how the the change would not hurt the band’s royalties from CD sales and how its royalties from online downloads would improve, the opinion said.

 

Linkin Park and Warner Brothers entered into a new recording agreement in 2006 with the help of Davis Shapiro as well as Hayes, who had said that the new agreement improved the band’s royalties, according to the opinion.

 

Hutchinson, whom the band had hired in 2009 to carry out a royalty audit, then claimed that the changes to the manner in which the royalties were calculated under the 2006 agreement had resulted in a drop in digital unit royalty rates.

 

A subsequent report that Hutchinson had prepared for the band, which detailed his evaluation of the differences between the 2002 and the 2006 contract, had led the band to terminate Hayes and the law firm in 2010, according to the opinion.

 

The move prompted Hayes and the law firm to bring the current suit against Hutchinson over his remarks in his evaluation report, according to the opinion. The plaintiffs had made claims for defamation, trade libel and intentional interference with contractual relations.

 

Hayes and the law firm had also submitted extra evidence to support its challenge of the reliability of Hutchinson’s calculations, the opinion indicated.

 

Hutchinson’s motion to strike had argued that his remarks in the report were protected because they were made “in anticipation of litigation,” according to the opinion. Hayes and the law firm had shot back that the contentious statements were not protected under the anti-SLAPP law because there was no litigation being considered at the time, the opinion said.

 

An attorney for Hutchinson could not immediately be reached for comment late Thursday.

 

The plaintiffs are represented by Lawrence Y. Iser and Gregory S. Gabriel of Kinsella Weitzman Iser Kump & Aldisert LLP.

 

The defendants are represented by Clair G. Burrill, Alison Minet Adams and the Law Offices of Robert S. Besser.

 

The case is Daniel B. Hayes et al. v. Paul Hutchinson et al., case number B237556, in the Court of Appeal for the State of California.

So maybe it really has something to do with this years dsp not being sold?

[Geki]

Didn't Mike mention some guy called Danny Hayes in Fort Minor songs? I remember that.

[LinkinMark]

Didn't Mike mention some guy called Danny Hayes in Fort Minor songs? I remember that.

This is all I could think of the whole time I was reading it lol

[hahninator]

Danny Hayes is who Ryu mentioned in Dolla when he said "You got a better chance of gettin' Danny Hayes on the phone."

[RogueSoul]

I don't understand any of this.

[JZLP-Benningstrong]

Me neither

 

could someone give us a summary in simple words?

[Justin]

Apparently Danny Hayes helped LP negotiate their 2002 contract with WB, and also to re-negotiate their contract in 2006. He told LP that the new contract improved their royalties, which led to the agreement being reached.

 

Then in 2009 LP hired someone else, Paul Hutchinson, to audit their royalties, I would assume to make sure that everything was as it should be. Apparently it turned out that when they signed in 2006, they were receiving less royalties from digital sales than they were before, despite WB and Hayes claiming their contract would give them MORE royalties from digital sales, not less. So the conclusion was reached that Hayes lied to Linkin Park in order to get them to sign their 2006 contract, which ended the WB/LP conflict, and Hutchinson discovered it.

 

The band fired Hayes, so Hayes decided to sue Hutchinson over his evaluation. He claims basically that Hutchinson intentionally caused conflict between Linkin Park and Hayes, and that Hutchinson lied to LP in order to harm Hayes' reputation and damage his credibility. Hutchinson tried to have the lawsuit dismissed by claiming the evaluation he gave LP was made in anticipation of legal action being taken. However, this claim was dismissed, so the lawsuit will proceed.

 

 

 

If I'm wrong...sorry. I'm sure Astat or Mark will correct me. From what I can see, that's how it looks in simple terms though.

Edited October 4, 2013 by Justin

[Rasputin 93]

thx for the summary!

[SOHAIL_Lq]

Me neither

 

could someone give us a summary in simple words?

while reading,I thought I'm the only one...seriously,I couldn't understand the whole paragraph

 

So the conclusion was reached that Hayes lied to Linkin Park in order to get them to sign their 2006 contract, which ended the WB/LP conflict, and Hutchinson discovered it.

 

The band fired Hayes, so Hayes decided to sue Hutchinson over his evaluation. Hutchinson tried to have the lawsuit dismissed by claiming the evaluation he gave LP was made in anticipation of legal action being taken. However, this claim was dismissed, so the lawsuit will proceed.

This,auditor lied.......that's what I read in graduation,& I'm 110% sure,he'll be sued.because in this profession,nobody listens to you if you're an auditor,& these auditors are mostly liars,so wtb "Hayes"?what do you think,if he wins the case,will band say sorry to him?or etc?

[Justin]

If it's proven that the auditor lied and Hayes was right, then wouldn't he be able to claim wrongful termination against LP?

[SOHAIL_Lq]

If it's proven that the auditor lied and Hayes was right, then wouldn't he be able to claim wrongful termination against LP?

no,it was auditor's fault,"PLaintiff's plea" is "I was terminated because of auditor's fault,& auditor's intention to get him terminated was involved,so auditor will be held responsible,as it's "not by mistake",in some cases,even if auditor is at mistake,he can be sued,prison+fine

auditor will have to face 2 cases,if I'm understanding the situation right,

#1 False report(the contract thing,getting low royalty as compared to old contract (Responsible to LP)

#2: due to his false statement,a person was terminated(responsible to "hayes)

 

if he got sued,his auditor certificate will be cancelled too!

this guy is in big trouble

Edited October 4, 2013 by MrXEROLP