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Let's "shine the light on another dark corner of the industry."
—— Don Henley
STARS WANT INDUSTRY PROBE
Henley, Love Ask Legislators to Investigate Accounting Practices
Urged by such recording artists as Courtney Love and Don Henley, California lawmakers are entertaining thoughts of investigating the music industry’s accounting practices.

Word of a possible record industry probe is the latest shot fired in what is becoming a mounting war between artists and their recording labels.

According to Reuters, Love, Henley and others have beefed up negotiations with members of the California legislature about probing music industry accounting practices.

Henley has been leading a group of recording artists lobbying for repeal of a loophole in state labor law they claim gives record companies unfair commercial control over performers' careers.

Last week, Democratic members of both the California Assembly and Senate spoke to Henley and his supporters about launching a legislative probe into the broader issues of record company accounting practices, the artist told Reuters.

Such an investigation, Henley said, would "shine the light on another dark corner of the industry."

California lawmakers' interest in corporate transparency has been sparked by recent financial scandals, he said.

State Sen. Kevin Murray told Reuters he plans to hold hearings this spring into accounting practices by the record labels.

Murray said his hearings would focus on allegations by artists that record companies routinely under-report and underpay royalties to performers.

A group of stars, including Love, Henley and Carole King, appeared in California's state capital last week to lobby for new legislation that would free artists from what they say is "indentured servitude" to record companies.

The artists' group, the Recording Artists Coalition, wants to repeal an amendment won by the music industry in 1987 that allows record labels to keeps performers tied to contracts longer than talent in other industries such as film and television.

Organized labor unions, including the AFL-CIO, have backed that campaign.

Now there is interest in examining how performers routinely have to spend money to audit expenses that labels claim against standard recording agreements, he said.

State Assemblyman Joe Nation, who represents Marin County, said he, too, had spoken with Henley about hearings on record company accounting issues.

Nation, an economist with expertise in antitrust issues, said he was waiting for more information before deciding whether to call such hearings.

But Murray, who introduced legislation amending the state labor law to close the 15-year-old exemption for record labels, said he would move ahead with hearings in the Senate.

"The auditors tell us that every time they audit they find that the labels significantly underpay, leading to the conclusion that the labels are not making honest mistakes but have a practice of stealing from the artists," he said.

Hilary Rosen, president and CEO of the Recording Industry Association of America, said such accusations were sensational and without merit. "Nobody would propose to make any excuse for bad accounting practices, but accusations of cheating are clearly emotional," Rosen said.

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