Bankruptcy appeal dismissed for lack of jurisdiction amid firing of popular music producer

By Charmaine Little | Jan 11, 2019

MIAMI -- A bankruptcy appeal was dismissed due to a lack of jurisdiction Dec. 27 in U.S. District Court for the Southern District of Florida.

U.S. District Judge Beth Bloom ruled on the case.

Music Royalty Consulting, Inc. legally responded to songwriter and music producer Scott Storch Music LLC, amid his Chapter 7 bankruptcy filing in 2015. MRCI and Storch’s issues date back to 2000 when Tuff Jew, Torch’s company, went into an exclusive songwriter and co-publishing agreement with TVT Music Inc. TVT then collected the publisher and writer shares of Tuff Jew’s royalties before Reservoir Media Management, Inc. became the successor of TVT. 

According to court documents, Tuff Jew and Reservoir entered into an asset purchase agreement where Reservoir became the 100 percent owner of copyrights and entitled to all the publisher’s share in musical compositions. MRCI then bought the writer’s share from Tuff Jew and Reservoir remitted the writer’s share of royalties to MRCI.

When Storch filed for bankruptcy, MRCI took legal action, arguing the bankruptcy court erred when it entered the rejection order (a ruling that deemed pre-petition contracts, such as the writer’s share MRCI bought from Tuff Jew) as rejected and MRCI appealed.

In dismissing the current case, Southern District of Florida Court first noted that the orders MRCI is appealing aren’t final orders. Under the 28 U.S.C. 158(a), the district courts do have jurisdiction for final judgments and orders, with prior leave of court. MRCI never asked for leave to appeal, and instead insisted that the court has jurisdiction.

The court also determined that all orders from the bankruptcy should be held. “Even assuming the court was to exercise jurisdiction to consider the merits of this appeal, MRCI’s argument fails for several reasons,” the court pointed out. One reasons is that the court disagrees with MRCI’s argument that an adversary proceeding was required. None of MRCI’s arguments are backed by a case law that was taken into account.

Ultimately, the court dismissed the case for lack of jurisdiction and ordered the clerk of the court to close the case altogether.

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