A federal court has ordered Proper Group to pay almost $1.9 million in connection with the 2021 buyout of Lyric Financial. Photo Credit: Sasun Bughdaryan
Proper Group (formerly Utopia Music) has officially been ordered to pay north of $1.86 million in connection with the 2021 buyout of advance provider Lyric Financial.
That order just recently came out of the U.S. District Court for the Southern District of New York, nearly three years after Utopia Music (the rebrand to Proper Group only occurred earlier in 2024) unveiled an agreement to acquire Lyric.
For a bit of quick background, the play was one of several Utopia finalized in 2021 and the beginning of 2022. In retrospect, the rapid-fire purchases laid the groundwork for far-reaching operational difficulties, among them bankruptcy proceedings, less-than-ideal contracts concerning certain elements of Utopia operations, layoffs, and executive shakeups.
Some of the businesses bought by Utopia/Proper during its landgrab, like Absolute Label Services and ROSTR, were re-purchased by their founders. Other holdings were sold off (Believe scooped up Sentric for over $50 million), and courtroom confrontations initiated over different deals and would-be deals yet.
Included in the latter category are SourceAudio and the initially mentioned Lyric Financial, for which the purchasing entity was to pay $8 million in total.
Predictably, amid the above-highlighted court order, the former Lyric Financial owners claimed they hadn’t received the entire sum. As described by the legal text, the sale price referred specifically to $5 million upfront and then two installments of $1.5 million.
But when the second $1.5 million payment allegedly failed to come to fruition, the sellers promptly pursued legal action across the pond. (The Proper Music distribution unit behind the namesake group sold to Utopia in January of 2022, operates a massive physical distribution hub, and is billed as the “largest totally independent entertainment distributor in the UK.”)
In the interest of brevity, the London Court of International Arbitration heard the case – including the defendants’ argument that Lyric Financial had fallen short of the transaction’s terms and failed to deliver the promised product – and ruled in the sellers’ favor about one month back.
The development set the stage for a stateside petition to recognize the arbitration award, which the aforesaid New York federal court has “granted in its entirety.”
With fees, said award comes out to $1,862,995.54 plus interest calculated from July 3rd (when the petition was filed) and “the date of the full payment.”
Though it perhaps goes without saying given the dispute over a years-old sale pact, the focus will now be on whether Proper actually forwards the almost $1.9 million in question to the plaintiffs. However, from a legal perspective, the business is evidently on the hook for the sizable sum.
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