Will Billy Joel overturn some record-industry applecarts with his $90 million lawsuit against the business’ most powerful attorney, Allen Grubman? The suit alleges that Grubman made deals he knew were to Joel’s detriment in order to benefit himself and Joel’s former manager, Frank Weber. It specifically charges Grubman and his firm, Grubman, Indursky, Schindler & Goldstein, with fraud, malpractice, breach of fiduciary duty, and breach of contract. Joel further claims that Grubman and a partner, Arthur Indursky, sold out his interests in favor of their own and paid Weber thousands of dollars in kickbacks.
Joel’s charges could unravel a law firm that has woven itself deep into the fabric of the industry. For the better part of a decade, Grubman, 50 (who graduated from Brooklyn Law School in 1967), has been a dominant deal maker and power broker, representing superstars, record companies, and executives. The firm has worked with artists Michael Jackson, Bruce Springsteen, and Madonna, as well as for many record companies, including Sony Music (formerly CBS Records), PolyGram, Chrysalis, and Island, and such record executives as Arista chairman Clive Davis, Sire founder Seymour Stein, and Columbia Records president Don Ienner.
Former manager Weber — who parted ways with the singer in 1989 after Joel sued him for fraud — hired Grubman to represent his boss in 1980. Joel now charges that Grubman et al. ”cast their allegiance to Weber, rather than Joel.” The suit further claims that Grubman and Indursky paid Weber $27,000 for steering Joel to the firm, that the law firm paid a Weber-owned financial-consulting service $100,000, and that the firm lent another Weber-owned company $250,000. The suit portrays the attorneys as desperate to keep Weber — who had to approve their fees — happy at any cost. Over time, the firm was paid more than $1 million for representing Joel.
The suit could make waves at record companies, too. Joel records for Sony’s Columbia Records, and Sony Music head Tommy Mottola is both a client and friend of Grubman’s. Al Teller, a former CBS Records president who now heads MCA’s music division, is also a client. Joel’s suit alleges that Weber lent Teller $300,000 from Joel’s pension fund. Teller has denied knowing the money was Joel’s.
Bertram Fields, the lawyer representing the law firm, categorically denied Joel’s allegations and said the firm is considering a countersuit. In short, it’s only rock & roll to them.