In July 2018, Glassnote Entertainment Group went to court to resolve their royalties dispute with the artist also known as Childish Gambino. The label claimed it owned the copyrights to the material in question and was, therefore, entitled to 50 percent of the royalties generated from "non-interactive streaming services." Glover's imprint McDJ Recording argued it had retained ownership of Gambino's masters and simply licensed them to Glassnote. Glover stated he was entitled to more than half of the royalties as he was both the recording artist and the owner of the work. Under this agreement, 45 percent of the royalties were to go to the artist, 50 percent to the copyright owner(s), and the other 5 percent to non-featured contributors like producers and engineers.
Glassnote stated that as part of the licensing deal, they were to receive 50 percent of the digital royalties. McDJ disagreed, according to court documents filed in September 2018:
Under the License Agreement, Glassnote is obligated to pay DJR a “Royalty” equal to 50% of the Net Proceeds received from the exploitation of the master recordings subject to that agreement. The Net Proceeds are defined as the “Gross Revenues” that exceed “Deducted Expenses.” Because SoundExchange royalties received by Glassnote, as the purported rights holder, are included in the definition of “Gross Revenues” under the License Agreement, those royalties are subject to the 50/50 Net Proceeds split. Thus, to the extent Glassnote has received [...] royalties from SoundExchange, those royalties must be split equally between Glassnote and DJR under the License Agreement, which are separate and distinct from the royalties that are paid directly by SoundExchange to the “featured artist” (Glover) and the royalties paid to “non-feature d artists.”
Glover and McDJ also accused the label of breach of contract, good faith, fair dealing, and fiduciary duty, and negligence.
Nearly eight months after this dispute became public, Variety reports the parties have settled the case. According to the outlet, Glover and Glassnote filed a stipulation Friday in the Southern District of New York. The details of the settlement were not disclosed, but they each agreed to toss their suits and cover their own attorneys' fees.