LOS ANGELES (CN) – A federal judge has dismissed a lawsuit claiming that Ozzy Osbourne swindled a former band member out of at least $2 million in royalties for songwriting on two of Osbourne’s hard-rock albums in the early 1980s, ruling that the dispute must be decided through arbitration.
U.S. District Judge Christina Snyder concluded that plaintiff Bob Daisley’s claims that Osbourne used a sham company, Blizzard Music Limited (US), to withhold royalty income from him stem from songwriter agreements that require arbitration.
Daisley argued that arbitration does not apply to Blizzard US and Osbourne, the suit’s defendants, because they are not parties to the agreements.
In her ruling this week, however, Snyder found that Daisley’s claims “touch and arise from the songwriter agreements,” keeping in mind that any doubts about whether issues are subject to attribution should be resolved in favor of arbitration.
Daisley alleges that Blizzard US and an affiliated company in England, Blizzard UK, which was not named in the suit but is covered by the songwriter agreements, are alter egos of Osbourne. Furthermore, he wants an accounting from both companies and Osbourne.
The “alter-ego allegations are sufficient to allow defendants to invoke the arbitration provision,” the judge ruled, adding that the request for an accounting from nonparty Blizzard UK underscores that Daisley’s claims arise out of the songwriter agreements.
Daisley played bass and co-wrote some of the songs on “Blizzard of Ozz” and “Diary of a Madman,” classic hard-rock albums considered to be the first ones featuring Osbourne as a solo artist, lifting him to fame. The albums were released in 1980 and 1981.
“Blizzard of Ozz” has sold more than 6 million copies worldwide. It features two well-known songs released as singles, “Crazy Train,” which has been featured in a variety of entertainment venues, and “Mr. Crowley.”
Daisley claims that Blizzard US is a sham company that improperly withholds his royalty income by taking a 15 percent fee for administering royalty payments, copyrights and commercial exploitation of the songs. The fee is in addition to the 10 percent fee for affiliate company Blizzard UK, his complaint states.
Daisley, who accuses the defendants of fraud, says an audit done at his request in 2014 revealed the additional withholding. He says he did not know of the arrangement with Blizzard US prior to the audit and did not agree to it.
His complaint states that the auditing firm estimated that at least $2 million in royalty income had been withheld, although it could not determine a precise amount.
Blizzard US contends that it’s entitled to its own fee because it’s an independent sub-publisher, according to Daisley’s complaint.
Daisley filed his complaint in a state court in Nevada last August, but the case was transferred to federal court.
Marcee Rondan, a publicist for Osbourne, has called the suit “tantamount to harassment.” In a prepared statement shortly after the suit was filed, she said prior audits found no discrepancies and that Daisley has lost previous lawsuits in the United Kingdom and United States.