Antone's Records: A Tragedy in Three Acts and 46 Pages

Antone's Records: A Tragedy in Three Acts and 46 Pages

Austin prides itself on being the Live Music Capital of the World. While many musicians travel to Austin with stars in their eyes, the reality is that it is difficult to earn a living in the music business, either as an artist or an independent record label. For the past eighteen months Bankruptcy Judge Craig Gargotta has received an extensive education on what can go wrong in relationships between record labels and their artists. This education was on full display in a 46 page opinion he wrote in Walser v. Antone's Records, et al, Adv. No. 09-1010 (Bankr. W.D. Tex. 1/24/11). You can find the opinion here.

However, Judge Gargotta was not the only one receiving an education. I represented the debtors and the case was a real eye opener for me. This is the story of Antone's Records, a tragedy in three acts.

Act I: Watermelon Records

During the 1980s and 1990s, Antone's Records and Watermelon Records were hometown competitors in the music business. Watermelon was founded by Heinz Geissler, a German immigrant. Its catalog focused on Americana music. Antone's Records was founded by nightclub owner Clifford Antone and focused on blues music. At some point during the 1990s, Dallas investor and music lover James Heldt acquired a majority stake in Antone's.

Watermelon Records was the first to fall. Watermelon Records filed for chapter 11 relief in 1998. At the time, many of its artists were unhappy with the label. After a contentious three year case involving competing plans and shifting alliances, Watermelon confirmed a plan in which its assets were sold to Texas Clef Entertainment Group, Inc. Texas Clef was an affiliate of Antone's Records which was formed to make the acquisition.

Read the entire article at A Texas Bankruptcy Lawyer's Blog