Megan Thee Stallion’s Label Countersues Over Contract Dispute

Matthew Ismael Ruiz

Mar 22, 2022

In response to Megan’s attempts to get Something for Thee Hotties ruled an album, 1501 Certified Entertainment claims she owes royalties on non-recording revenue

Megan Thee Stallion’s label 1501 Certified Entertainment—which she sued last month, for the second time—has filed a countersuit in Harris County District Court, claiming the Houston rapper is in breach of contract, and that her latest release Something for Thee Hotties “does not meet the requirements of an ‘album’ under the three contracts that she has signed with 1501.” According to documents viewed by Pitchfork, the label seeks a declaration from the court that the record is not an album, monetary damages based on the contract breaches, and attorneys’ fees and costs.

“This is yet another absurd attempt by 1501 to disregard Megan’s album and squeeze more money and more free work out of her for as long as possible,” Megan Thee Stallion’s attorney Brad Hancock said in a statement shared with Pitchfork. “We will ask the court to protect Megan from this type of abuse.” Megan filed her second suit against 1501 in Harris County last month, alleging the label refused to allow her to fulfill the terms of her contract by denying that her LP Something for Thee Hotties did not meet the legal definition of an “album.”

The countersuit also reveals new details about the recording contracts that Megan found onerous enough to warrant filing her original lawsuit. The label alleges that the terms of multiple contracts Megan has signed with the label—including a distribution deal with Houston rap luminary J. Prince and Lyor Cohen’s 300 Entertainment—requires a release to contain “at least 12 new master recordings of her studio performances of previously-unreleased musical compositions” and approval from the label prior to release. Of the 21 tracks on Something for Thee Hotties, 12 are indeed original compositions that had not previously received an official release.

In her original suit, Megan claimed the only contractually obligated parameter defining a release as an album was a 45-minute runtime, which she exceeded by two seconds. In its countersuit, 1501 argues that because the record’s track list contains several interludes, YouTube freestyles, and “archival material,” the total runtime of new recordings is only 29 minutes long.

In a letter sent last month to 1501’s attorneys and viewed by Pitchfork, Hancock stated:

There are no other parameters or requirements under the contract for what can be deemed an “Album” other than total run time of the album. Additionally, nothing in the recording agreement puts any limits or restrictions on the nature of the content that makes up the “Album.” As such, an “Album” may consist of a compilation of musical compositions, regardless of when the musical recordings were originally released, along with spoken interlude recordings (i.e., skits).
1501 makes further claims against Megan The Stallion, accusing her of breach of contract by refusing to account to 1501 for her various collaborations, sponsorships, endorsements, and side engagements—such as her recent deal with Popeye’s. 1501 claims Megan‘s contract entitles them to require approval for any such deals, as well as a percentage of any fee collected.

Both parties agree that they reached a settlement in that first suit, but 1501 claims Megan's team never filed the subsequent paperwork, then “denied the existence and enforceability of that Settlement Agreement while accepting benefits under it.” 1501 says they then filed a motion to enforce the terms of the agreement and dismiss the suit; days before a scheduled hearing, Megan’s team dismissed the suit and quickly filed a new one.

Megan has thus far been tweeting through it, alleging that when her lawyers requested an accounting of 1501’s expenses relating to her career, 1501 label boss Carl Crawford included his own personal jewelry purchases in the report.

1501 seems to point the finger for Megan’s displeasure with her contract directly at Roc Nation, the Jay-Z–led management firm with which Megan signed after the death of her former agent, her mother Holly Thomas. In the suit, 1501 claims “Roc Nation is notorious in the music industry for trying to persuade its management clients to leave their record labels and sign with Roc Nation’s affiliated label. The acrimony between the parties began with Roc Nation’s involvement.”