By Liane M. Kufchock
Aug. 13 (Bloomberg) — A fight for control of the assets of
Death Row Records Inc., the bankrupt rap label, ended in a truce
with two companies saying they’ll work together to close a
$24 million sale that includes the rights to popular artists.
Global Music Group Inc. of Delaware dropped a lawsuit
against Global Music Group of New York after reaching an
agreement to be equal partners, said Ron Goldberg, head of the
Delaware group. Last month, the groups traded accusations of
death threats and falsifying documents in a dispute in a Los
Angeles bankruptcy court over who won an auction to buy the
record label.
“We had a disagreement and it’s over,” Goldberg said
today in a telephone interview. “We’re virtually 50-50 partners
on most aspects of the deal. I couldn’t be happier and I’m not
an easy person to please.”
Trustees for the bankruptcy case postponed a July 23
deadline to close the sale after members of the New York group
alleged in court papers that Goldberg threatened them with
extortion and death, prompting a lender to back out of a
financing agreement.
Goldberg, who through his lawyer denied making threats, had
accused former business partner Anthony Marotta and others of
cutting him out of the deal by changing the company’s location
on bidding documents from Delaware to New York.
Kathleen March, an attorney representing the New York
group, confirmed a settlement was reached. She declined in a
phone interview today to discuss terms of the deal or to
disclose the new closing deadline, which she said isn’t part of
the public record.
Goldberg’s attorney, Michael Collesano, said he expects to
file the terms of the settlement with the bankruptcy court.
“The trustees’ counsel asked us to file the settlement
with the court,” Collesano said.

State Court Complaint

Goldberg sued Marotta and other former partners July 15 in
California state court to stop them from claiming they own Death
Row Records’ assets, including its music catalog, under the name
Global Music Group New York. That complaint, which sought more
than $25 million in damages, was transferred to the federal
bankruptcy court.
U.S. Bankruptcy Judge Vincent Zurzolo refused to hold up
the sale, saying in a July 24 order that Goldberg’s allegations
“do not appear to attack the propriety of the sale or sale
procedures, but instead reflect an ownership dispute.”
Death Row Records, founded in 1991, signed some of rap’s
biggest names, including 2Pac, Dr. Dre and Snoop Dogg. It filed
for bankruptcy in April 2006 after owner Marion “Suge” Knight
failed to pay a $107 million legal judgment to former partners
Lydia and Michael Harris.
The bankruptcy case is Death Row Records, 06-11205, U.S.
Bankruptcy Court, Central District of California (Los Angeles).

–Editors: Peter Blumberg, Mike Hytha

To contact the reporter on this story:
Liane Kufchock in Southfield, Michigan, +1-248-827-2949 or
lkufchock@bloomberg.net.

To contact the editors responsible for this story:
Patrick Oster at +1-212-617-4088 or poster@bloomberg.net;
Jennifer Sondag at 212-617-2716 or jsondag@bloomberg.net.