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Fyre Festival bankruptcy trustee seeks to recover fees paid to artists

By | Published on Monday 2 September 2019

Fyre Festival

A whole new chapter in the long-running Fyre Festival saga began last week when the trustee who was appointed after the Fyre company fell into bankruptcy began legal proceedings to try to recover fees paid to artists who were scheduled to played the failed event in 2017.

A plethora of companies which received upfront monies from the Fyre Festival and its founder Billy McFarland were named as defendants on lawsuits filed with the US courts last week. That includes booking agencies like CAA, UTA, ICM and Nue Agency, which negotiated fees for various artists who were booked by McFarland and his team.

The Fyre Festival, of course, was promoted by a flurry of influencers as a prestigious luxurious event in the Bahamas. But in the end it fell apart just as things were getting started, when it became clear that the team behind it all had failed to put in place the required infrastructure for even a very basic festival. A stack of lawsuits were filed in the wake of the event’s collapse, while McFarland himself was ultimately jailed for fraud.

Trustee Greg Messer is seeking to recover monies for the victims of that fraud, which include ticketholders, creditors and the people and companies which invested money into McFarland’s scam believing it to be a legitimate venture.

In addition to the booking agencies, lawsuits were filed last week against other suppliers to the festival which received some or all of their payments upfront. That includes some of those influencers who supplied the hype in return for a big pile of cash, among them Kendall Jenner and model Emily Ratajkowski.

The legal papers also accuse Jenner and Ratajkowski of demonstrating a “clear lack of good faith” because they did not disclose to their followers on Instagram that they’d been paid mega-bucks ($275,000 and $300,000 respectively) to big up McFarland’s party. Not only that, the lawsuits add, “nor did they inform their fans and followers that they ultimately decided not to attend the festival because of problems with the [event] of which they … were uniquely aware”.

On the music side, Messer is trying to get back fees paid to the likes of Pusha T, Tyga, Migos, Skepta and headliners Blink 182, who – the lawsuit claims – received $500,000.

Of course, generally speaking for festivals – especially new unproven festivals – it’s industry standard for artists and their agents to demand that fees are paid upfront. And those upfront payments are non-refundable if a festival does not go ahead. After all, artists have a finite number of days each year when they can perform, and once they are committed to the subsequently cancelled event, they are turning down other revenue generating opportunities.

However, Messer is arguing that because those fees were paid out of monies that McFarland had fraudulently acquired from his investors, they should be returned in this instance. The fees, his legal filing adds, amounted to an “unfair expense of Fyre Festival’s defrauded investors, creditors and ticketholders”.

It remains to be seen how that argument fairs in court. Though one other agency which had artists booked to play Fyre is seemingly negotiating with Messer on a possible settlement, and to that end was not a defendant on last week’s lawsuits. That agency is Paradigm.

According to Billboard, another legal filing confirmed that those settlement talks are ongoing, with both sides keen to avoid litigation. It remains to be seen if anything can be agreed.

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