Music sharing service CEO claims retailer breached job contract

On Behalf of | Jun 15, 2012 | Employment Law

Both companies and employees are bound by the contents of a signed job agreement. The elements of the contract can sometimes extend past a worker’s last date of employment, if the parties agree to certain provisions in a severance package. An employment contract remains in effect until the provisions are satisfied.

A jury may soon determine whether the ex-CEO of the now-defunct online music service is due any money from his former employer, a major big box retailer. The plaintiff claims the electronics retailer violated an employment contract when the executive left.

The plaintiff’s original company purchased the sharing service a dozen years ago. Both companies and their CEO were scooped up by the retailer in 2008.

The lawsuit claims the plaintiff signed an employment agreement with the retailer that would have paid the executive $5.8 million for meeting certain performance goals. The plaintiff told a federal court that his job description was to ensure the sharing service’s growth. The former CEO said he grew disappointed when his new employer’s executives apparently lost interest in expansion of the music service.

His frustration with the company’s lack of enthusiasm led to “an amicable separation,” including a full severance package that company officials reportedly did not pay in full.

The plaintiff is charging the retailer with good faith and contract breaches as well as unjust enrichment. He is asking for damages of over $75,000 for each of the five counts.

The former chief executive believes the retailer may have attempted to avoid its financial obligations by selling the service last year to competing music service. Following the purchase, the new owner absorbed the service’s customer base and then let the once-controversial enterprise fold.


Alan Olson practices employment law throughout the United States from his offices in New Berlin, Wisconsin. Attorney Olson may be contacted at [email protected] with questions about the information posted here.

Source: St. Paul Pioneer Press, “Former Napster CEO sues Best Buy, claims breach of employment contract,” Tom Webb, June 2, 2012


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