Final Wednesday (June 14), Music Enterprise Worldwide dove deep into the ill-tempered saga of Taylor Swift’s ‘Massive Machine’ masters being bought – first to Scooter Braun’s Ithaca Holdings in June 2019, after which to US-based monetary agency Shamrock Capital in October 2020.
In our 4,000-word investigation into these offers, we uncovered some main revelations, together with:
- Scott Swift, Taylor Swift’s father and a Merill Lynch stockbroker, obtained a USD $15.1 million payout from the sale of Massive Machine Label Group (BMLG) to Scooter Braun’s Ithaca Holdings in summer season 2019, due to Mr. Swift’s ~5% shareholding in Massive Machine Information LLC;
- Scooter Braun is nearly actually now a billionaire, who made a $265 million revenue on his buy and subsequent sale of Swift’s first six albums. (Braun’s workforce valued the Swift catalog at $140 million when buying Massive Machine Label Group in 2019; Braun then bought Swift’s masters to Shamrock in 2020 for a complete consideration of $405 million).
Maybe the largest discovery in MBW’s in-depth report, nevertheless, was this:
- In November 2019, Jay Schaudies from Swift’s administration agency, 13 Administration, co-signed an NDA with Scooter Braun – representing Ithaca Holdings – that granted Swift’s workforce the chance to dig into the financials of Massive Machine, presumably with a view to Swift buying her masters again from Braun.
MBW obtained this signed five-page NDA in full, which contained no point out of reputational protections for Scooter Braun.
This was complicated, as a 12 months later, in November 2020, Taylor Swift publicly alleged: “Scooter’s workforce needed me to signal an ironclad NDA stating I’d by no means say one other phrase about Scooter Braun until it was optimistic, earlier than we may even have a look at the monetary information of BMLG.”
Now, MBW has obtained extra startling proof on this saga.
It exhibits simply how shut Scooter Braun and Ithaca got here to promoting Swift the rights to her first six albums – and the way a possible deal fell aside…
Exhibit A: The Jay Schaudies e mail to Scooter Braun, Might 15, 2020
MBW has obtained a revelatory e mail from 13 Administration’s Jay Schaudies despatched to Scooter Braun in mid-Might, 2020.
Context: This was 11 months since Braun’s Ithaca Holdings had purchased the masters to Swift’s first six albums (through Massive Machine) – and since Swift had first publicly voiced her upset about that deal.
Importantly, this was additionally 5 months earlier than Braun/Ithaca then bought Swift’s ‘Massive Machine’ masters to US monetary agency, Shamrock Capital, in October 2020.
Ergo, there was nonetheless time for Scooter Braun to do what Taylor Swift followers needed, and promote the artist ‘again’ her Massive Machine masters.
Guess what? That’s precisely what Braun was open to doing – and was even eager to do – in keeping with Schaudies’ Might 2020 e mail.
“You may have instructed me and others, akin to Ed Sheeran, that you just’d wish to see Taylor personal these, and I recognize any efforts in your half to assist make that occur.”
Jay Schaudies e mail to Scooter Braun, Might 2020
“We final spoke on Might 5 while you requested me to name you after I emailed you saying that we have been nonetheless all in favour of buying all the Taylor Swift property and rights held by BMLG,” reads Schaudies’ e mail to Braun.
“You stated you weren’t all in favour of promoting BMLG as a complete, however that you just have been all in favour of promoting Taylor her masters. You may have instructed me and others, akin to Ed Sheeran, that you’d wish to see Taylor personal these, and I recognize any efforts in your half to assist make that occur.”
That is the primary stable public proof that Scooter Braun, having acquired the masters of Swift’s first six albums, subsequently deliberate to promote them again to the artist.
There was a second part in Shaudies’ e mail, nevertheless, that returns us to a now-familiar can of worms: The alleged “ironclad NDA” clause that, within the phrases of Swift, would power her to “by no means say one other phrase about Scooter Braun until it was optimistic, earlier than we may even have a look at the monetary information of BMLG”.
As a reminder, MBW has possession of a mutually-signed November 2019 NDA between 13 Administration and Ithaca below which Ithaca dedicated to handing to 13 Administration “all personal, proprietary enterprise data” about its firm (and Massive Machine) “concerning a Potential Transaction”.
So what have we discovered since publishing our story final week?
Months after the mutual signing of that November 2019 NDA, as we moved into spring/summer season 2020, Ithaca and 13 Administration started a back-and-forth on a wholly new NDA.
As soon as once more, this NDA clearly facilitated a negotiation for Swift/13 Administration to buy her ‘Massive Machine’ masters from Ithaca.
And it’s one specific clause inside this subsequent NDA that seems to have left Swift, and Jay Schaudies at 13 Administration, displeased concerning potential restrictions over the artist’s freedom to talk publicly.
In his e mail to Braun in Might 2020, Schaudies wrote: “I supplied to signal a brand new NDA, and also you stated you needed to consider that, contemplating extra stringent restrictions past the deal itself. You steered that each Taylor and her publicist Tree Paine needs to be prohibited from talking in any respect about you or your traders. I stated that may’t occur, however that the main points of the deal may very well be protected.”
Added Schaudies: “The NDA can’t function a one-sided, surrogate gag order. Taylor have to be free to advertise her music and when she re-records outdated songs, she needs to be free to talk with out inappropriate limitations. Nonetheless, we’re more than pleased to signal a customary NDA, as we did earlier than [in November 2019].”
Right here’s the place issues get a bit… bumpy.
Throughout spring/summer season 2020, Ithaca Holdings and 13 Administration went backwards and forwards on draft variations of a brand new negotiation-starting NDA.
MBW has obtained a draft model of this NDA from June 2020. It was despatched from a authorized rep for Ithaca Holdings to Jay Schaudies at 13 Administration on June 29, 2020, in keeping with emails seen by MBW.
Ithaca Holdings, within the communications we’ve seen, was keen to signal this June 2020 NDA.
As for whether or not its content material constituted, in Schaudies’ phrases, a “one-sided gag order”?
Decide for your self.
Exhibit B: The brand new draft NDA – despatched by Ithaca to 13 Administration on June 29, 2020
MBW has learn cover-to-cover the June 2020 draft NDA despatched by reps for Ithaca to 13 Administration for approval.
Solely Ithaca and 13 Administration are named as ‘Events’ on this draft settlement.
Scooter Braun is just not a named as a Occasion, neither is Taylor Swift – although the doc makes clear that 13 Administration is “appearing expressly on behalf and because the licensed agent for Taylor Swift”. (Swift is referred to all through the NDA, as authorized shorthand, because the ‘Artist’.)
The seven-page doc accommodates just one part – Clause 4 – that clearly makes an attempt to limit what every Occasion within the deal can say about each other publicly.
Nonetheless, this clause solely seems to limit what will be stated about particulars of the deal negotiation itself – reasonably than any people concerned.
Right here is the complete textual content of the related NDA clause (Clause 4), with MBW’s bolding on the necessary segments:
4. No Disclosures Of Any Form About Discussions. Every Occasion and Artist agrees that, with out the prior written consent of the opposite Occasion, no Occasion, no Occasion’s Consultant, and neither Artist nor Artist’s Representatives, could disclose, reveal, reveal, present, touch upon, characterize, opine on, or recommend to any particular person or entity (whether or not immediately or not directly) any of the next:
(a) The existence of this Settlement;
(b) the existence of, substance of, and/or full or partial particulars about any Dialogue Info (and any side of it), together with the substance or existence of any proposals or valuations;
(c) the existence of, substance of, and/or full or partial particulars about any Potential Transaction; or
(d) the contents or substance of any Analysis Materials and the truth that any Occasion or its Representatives have obtained or offered Analysis Materials.
Any data required to be handled as confidential below this Settlement shall be known as “Confidential Info.”
The phrases “Disclose,” “Disclosed,” or “Disclosure” shall imply to disclose, reveal, give, touch upon, characterize, opine about, or make accessible Supplies, or any half thereof, or any data contained therein, to any particular person or entity or to the general public at massive, together with through social media posts (e.g. Twitter, Instagram, or different platforms) or by offering data to members of the information media (whether or not on background or as an nameless supply).
That’s it – the entire clause.
To MBW’s understanding, the clause seems to quantity to this: if Ithaca needed to typically criticize Taylor Swift publicly – or if Swift needed to typically criticize Ithaca or certainly Scooter Braun publicly – they might presumably be free to take action.
Nonetheless, if both celebration publicly disclosed and/or criticized: (a) any deal proposals/valuations mentioned between Ithaca and 13 Administration; or (b) the ‘Analysis Supplies’ – “all personal, proprietary enterprise data concerning a potential transaction” – then they might clearly be in breach of the NDA.
What occurred subsequent?
To a level (as we identified in our earlier article on this matter) we are able to form of skip to the top right here: no matter occurred between Ithaca Holdings and 13 Administration following the above NDA proposal in June 2020, we all know – by nature of Shamrock’s acquisition of Swift’s masters 5 months later – {that a} deal clearly wasn’t agreed.
Nonetheless, MBW does have some necessary additional element to convey to the desk.
We’ve seen an e mail from Jay Schaudies in response to that June 2020 NDA steered by Ithaca – despatched a month in a while July 29 – noting Schaudies’ concern that the “proposed NDA… nonetheless seems like an try to muzzle Taylor”.
We’ve additionally seen an e mail from a authorized rep for Ithaca despatched to Schaudies on August 25, 2020, which states that “after discussing internally, we really feel like we are able to transfer ahead on the prior kind” – i.e. Ithaca was keen to scrap the June 2020 NDA, and return to that authentic, mutually signed, November 2019 NDA.
Most significantly, a senior ex-employee of Ithaca – who was immediately concerned within the deal negotiations – claims that two “exhausting gives” have been made verbally by Scooter Braun to Jay Schaudies/13 Administration on two separate events:
- The primary provide got here in mid-November 2019, in response to Taylor Swift’s public outcry associated to her ‘Massive Machine’ masters and that 12 months’s American Music Awards (AMAs). Per week earlier than the AMAs occasion, says our supply, Scooter Braun instructed 13 Administration that Ithaca was keen to promote the masters of Taylor Swift’s six ‘Massive Machine’ albums to 13 Administration / the artist for USD $300 million. Braun additionally instructed 13 Administration that Ithaca had secured pre-approval on a financing deal, offered by 23 Capital, to completely fund Swift’s acquisition on the $300 million worth. The provide was rejected;
- Braun’s second provide got here almost a 12 months later, in October 2020. Our supply says that, this time, Braun supplied to promote Swift’s ‘Massive Machine’ masters to the artist/13 Administration for $305 million – representing a $100 million low cost on the $405 million that Shamrock Capital would finally pay Braun/Ithaca for the masters. This provide, says our supply, was additionally rejected – after which Braun went forward with a deal to promote the masters to Shamrock.
Within the wake of studying about these two priced gives from Scooter Braun to 13 Administration, MBW contacted a supply near Taylor Swift. They replied, through e mail: “In 2020, the power to judge any alternative for Taylor to buy her catalog was conditioned on signing a gag order NDA prohibiting her from ever talking the reality about Scooter and the state of affairs.
“Taylor has fully moved on from this saga, and has turned what began out as a particularly painful state of affairs into one among most fulfilling inventive endeavors of her life.”
Our ex-employee supply at Ithaca stays adamant that there was by no means an NDA that contained a “gag order” concerning Swift’s means to talk publicly about Scooter Braun.
The ex-Ithaca supply stated: “There have been a number of gives for [Swift] to buy her masters from [Braun] and at no level within the NDA was she ordered to be silent by Scooter. Actually, he isn’t even talked about. Her narrative was at all times very complicated to me.”
Yesterday (June 21), Taylor Swift announced she could be bringing her record-breaking Eras tour to the UK, Europe, and Asia in 2024.
Swift, who according to Forbes is price $740 million, was the biggest-selling recording artist on the planet in 2022, in keeping with IFPI.
Her latest studio album, a ‘Taylor’s Model’ re-record of her 2010 Massive Machine LP, Communicate Now, is due for launch on July 7.Music Enterprise Worldwide
