The monetary issues of Correct Group, the corporate previously generally known as Utopia Music, continued this week as a court docket in Switzerland initiated chapter proceedings in opposition to the corporate over an unpaid authorized invoice.
Correct says the chapter case was introduced by MME Authorized, a legislation agency to which the music firm owed CHF 23,000 (approx. USD $27,000).
The music firm says it was unaware that Zug-based MME Authorized had launched authorized proceedings in opposition to it. Because of this, it missed a court docket listening to on Tuesday, triggering the court docket’s chapter continuing.
In a press release issued on Thursday (September 26), Correct stated it had settled the debt to MME Authorized in full and plans to launch an attraction to halt the proceedings.
“We’re disillusioned that chapter proceedings have been triggered. Our firm was sadly unaware that authorized proceedings over a minor debt have been going down, and because of this we weren’t represented on the court docket listening to,” a Correct spokesperson stated in a press release.
“Our debt has now been settled and we’re after all interesting this resolution.”
Swiss-born Correct Group has skilled a sequence of economic crises over the previous few years, after a high-profile and aggressive acquisition spree started to take a toll on the corporate.
In 2023, there have been studies that firm workers in Sweden have been going unpaid.
Earlier this yr, a US court docket ordered the corporate to pay $1.9 million to the previous house owners of Lyric Monetary, a music financing platform that Correct (on the time known as Utopia) had acquired in 2021. An arbitration panel discovered that Correct had didn’t make the final installment cost on the acquisition.
“Current optimistic developments within the enterprise have positioned us on observe to near-term money circulate positivity, with clear prospects of profitability by 2025.”
Correct Group
The monetary issues comply with an aggressive buying spree that noticed Utopia purchase such corporations as Quincy Jones-backed Musimap, UK warehouse and success agency Cinram Novum, writer Sentric Music Group, Absolute Label Companies and Absolute Rights Administration, and Correct Music Group, the UK-based firm after which Utopia renamed itself.
However indicators of economic bother on the firm weren’t lengthy in coming. Beginning in late 2022, the corporate initiated a sequence of mass layoffs, and shortly started unloading most of the belongings it had amassed, together with Sentric, Absolute, and ROSTR.
Full Music Replace studies that the missed court docket date this week was the results of understaffing on the firm, following the layoffs.
Amid the fireplace sale, the corporate has repeatedly requested its shareholders for more money injections. Nonetheless, the corporate says it’s heading in the right direction and expects to achieve profitability subsequent yr.
“Current optimistic developments within the enterprise have positioned us on observe to near-term money circulate positivity, with clear prospects of profitability by 2025, so we count on to achieve a positive consequence,” a spokesperson stated on Thursday.Music Enterprise Worldwide
