Delaware judge: Cheap Trick case belongs in home

Published: Friday, Dec. 13, 2013 1:15 a.m. CDT • Updated: Friday, Dec. 13, 2013 11:35 a.m. CDT

WILMINGTON, Del. (AP) – A Delaware judge on Thursday dismissed a lawsuit filed by three members of the rock group Cheap Trick against the band’s ex-drummer, saying a dispute among the musicians should be decided in federal court in Illinois, where they formed.

Guitarist Rick Nielesen, vocalist Robin Zander and bassist Tom Peterson sought a court declaration validating steps they took earlier this year to remove drummer Brad Carlson, also known as Bun E. Carlos, as a board member of three band businesses incorporated in Delaware.

The three other band members contend that Carlos, who stopped touring with the group three years ago, lost his voting rights as a shareholder because he had left the band. The longtime group, known for its use of vintage guitars on tour, gained acclaim over the decades with such hits as “Surrender,” ‘’I Want You to Want Me” and “Dream Police.”

The band, minus Carlson, is still touring and is slated to headline a Mardi Gras event in New Orleans in March.

By agreement with other band members, Carlson stopped touring with the group in 2010. But he disputes their claims that he is no longer a member of Cheap Trick and is not entitled to participate in its business affairs.

Carlson’s attorneys argue that he was improperly ousted, citing a previous agreement that says any decision involving the band requires the unanimous consent of all four members. The drummer’s lawyers also said the Delaware suit should be dismissed in a favor of an earlier lawsuit filed in federal court in Illinois, in which Carlos and former band manager David Frey claim their purported ousters were invalid. The two claim they are owed hundreds of thousands of dollars.

Chancellor Leo Strine Jr. agreed with Carlos’ attorneys, saying many of the issues in the Delaware lawsuit are identical to those raised in the Illinois case.

“There’s no question that this case and the Illinois action arise out of a common nucleus of facts,” the judge said.

Strine said Illinois, where the band formed in the 1970s and where two members still live, was a logical jurisdiction for resolving “garden-variety” questions of contract interpretation, including whether Carlson is still a member of the band.

The dispute pitting Carlos against the other band members hinges on a March 2010 “Live Performance Agreement,” which states that Carlson would no longer have to tour with the group but would continue to receive “all remuneration” due to him, including what he would have been paid had he participated in live performances.

The three other members claim that the agreement addressed only payments to Carlson, not his status as a band member or his voting rights as a director of various Cheap Trick business entities. Those entities include Cheap Trick Merchandise Inc., Cheap Trick Touring Inc., and Cheap Trick Unlimited. All three are incorporated in Delaware but based in Nashville, Tenn.

Carlos argues that he remains a full voting member of the band and fully participating shareholder in its various business entities. He says the other members have improperly excluded from various activities, including the recording of a new studio album, and have improperly entered into contracts and made other business decisions without his consent.

“Moreover, the defendants are refusing to account for, or pay to Carlos, hundreds of thousands of dollars he is owed under the Live Performance Agreement and the other corporate agreements for the Cheap Trick companies,” the Illinois lawsuit asserts.

Frey claims that he is also owed money by the three band members, including the balance of a loan he gave the group so it could continue a tour after a July 2011 stage collapse in Ottawa that injured three people and destroyed much of the band’s equipment.

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