Megan Thee Stallion Wins Early Round in Contract War With Houston Label

A Texas judge sided with Megan Thee Stallion on Wednesday when he denied her estranged Houston label’s request that her 2021 album Something for Thee Hotties be declared something less than an album under her contract.

The Harris County judge rejected 1501 Certified Entertainment’s motion for the pre-trial ruling, known as a partial summary judgment, in a one-page decision that means Megan’s $1 million lawsuit against the label can proceed to trial intact.

The label had filed its request Sept. 14, arguing that the court should bypass a trial and simply rule outright that Something for Thee Hotties was not an “album” under Megan’s contract because it included previously available recordings and purportedly “failed to follow the proper approval procedures.”

Megan, born Megan Pete, replied to the motion Dec. 19, arguing that she fully complied with the terms of her deal regarding Something for Thee Hotties and deserved a chance to argue her case at trial.

“Pete should be allowed her day in court to present evidence and testimony to the jury demonstrating that she has done all that was required of her in the delivery and release of her albums,” her successful response filing read.

In her paperwork, Pete argues that the freestyles and skits included on her album do not count as previously published material because even though some may have appeared on YouTube, they were never available in a format that was commercially distributed to the public for sale.

“If there is any ambiguity around the term ‘previously-unreleased,’ it should be reserved as a question of fact for the jury,” Megan’s Dec. 19 opposition paperwork reads.

She further argues that after a company called 300 Entertainment bought the exclusive right to manufacture, distribute, sell, transmit and otherwise exploit her albums in 2018, she began working exclusively with 300 Entertainment to prepare and release her albums.

She says 300 Entertainment “kept 1501 apprised of developments” for months leading up to the album’s release and that the company provided 1501 with a link to Something for Thee Hotties at least three days prior to its release. She claims 1501 “asserted no objection” until two months after the album’s release.

Pete, who testified two weeks ago at Tory Lanez’s felony criminal trial in Los Angeles before he was convicted Friday of shooting her in both feet, filed her underlying lawsuit against 1501 on Feb. 18, 2022. The label countersued Pete in March.

1501’s lawyer had no immediate comment when reached by Rolling Stone late Wednesday.

In a new amended complaint filed in August, Pete asked a Harris County judge to declare that Traumazine, her new album released Aug. 12, along with Something for Thee Hotties “both constitute an ‘album’ as defined in the parties’ recording agreement,’ and therefore she “has satisfied all option periods” in her contract signed in 2018.

She also asked for at least $1 million in damages, upping the ante after her first lawsuit asked for non-monetary damage.

According to Pete, she’s the victim of a “tortured” relationship with 1501 that was first outlined in an initial legal battle with 1501 dating back to March 2020. She’s been very public about her efforts to extricate herself from her “unconscionable” contract signed with the independent label owned by ex-professional baseball player Carl Crawford when she was an up-and-coming artist on the brink of superstardom.

Crawford and 1501 have vigorously pushed back in the case. They’ve even claimed Pete still owes the label “many millions” from her ancillary activities such as touring, endorsements, merchandising and even acting.

In filings reviewed by Rolling Stone, the label argues the relationship started to sour when Pete hired Roc Nation as her management firm in September 2019. Pete says Roc Nation simply helped her understand for the first time that her 1501 contract was not in keeping with industry norms. Instead of the standard 50-50 split of recording profits, Pete’s initial deal gave the label 60 percent of her recording income – with payments to outside parties such as producers coming out of her paycheck. The initial contract also gave the label a 30 percent chunk of her touring and merchandising profits.

“When I got with Roc Nation, I got management – real management – and real lawyers,” Pete said in a March 2020 video posted on Twitter. “They were like, ‘Do you know that this is in your contract?’ And I was like, ‘Oh, damn, that’s crazy. No, I didn’t know.’”

Pete won a restraining order in 2020 and reached a settlement with 1501 in March 2021 that amended portions of her contract. But she still had two albums left to deliver.

She claims in her new first amended complaint that she’s now fulfilled that debt and deserves to be severed from her “entirely one-sided” contract. She’s asking for the minimum of $1 million in damages because 1501 allegedly has refused to fork over her share of the royalties from her music.

For its part, 1501 denies any wrongdoing.

“I think at the end of the day, Megan owes 1501 lot more money that she claims 1501 owes her,” Steven Zager, a partner at King & Spalding LLP in Austin, previously told Rolling Stone.