Payola-gate Goes Universal

Is Universal Records the next stop on Elliot Spitzer’spay-for-play crusade? Ever since the New York attorney general’s landmark $10million settlement with Sony BMG forced the world’s second-biggest musiccompany to overhaul its business practices and fire JoelKlaiman, Epic’s executive VP of promotions, news reports havefingered Universal as another possible target of Spitzer’s probe. Now,music industry insiders say, a bright-red payola bullseye has alighted on theback of one of the music giant’s top-tier execs: ValerieDeLong, Universal Records’ senior VP for promotions.

One reason DeLong’s name has emerged as a likely Spitzer target is arecent lawsuit filed against Universal by two independent promotion firms,National Music Marketing and Majestic Productions. The suit alleges that twoUniversal promotions execs, Chuck Field and GaryMarella, pressured the companies into participating in a payola schemein which they would ply radio stations with lucrative promotional deals,ostensibly in exchange for “first access to the stations’playlist data”—but really to ensure air time for theirartists’ songs.

To make matters worse, the suit alleges, the Universal execs demanded thatthe companies file false invoices that would charge small-time artists’promotion fees to the promotional budgets of deeper-pocketed Grammy-winners likeNelly, who would never notice the expenditures. According to asource close to the suit, both men were taking orders directly from DeLong inthe alleged payola scam. “She knew exactly what was going down,” thesource says. “I’ve been told that Delong may be added as a defendantin an amended complaint.”

Universal spokesman Peter Lofrumento confirmed that DeLongwas Field and Marella’s immediate superior, but declined to commentfurther on pending litigation. But DeLong’s Lawyer, Eric Greenspan, said,“Val has not been mentioned in the lawsuit, nor has she been named. Thereis no allegation that she did anything wrong, ever.”

As for whether his client will be singled out in Spitzer’s payolaprobe, Greenspan said, “Universal is the biggest record company in thebusiness, how do you not want to talk to these people? It doesn’t make anysense not to.” The attorney general’s spokesman, BradMaione, would only say, “The investigation is ongoing, and I justhope that everybody will stay tuned.”

Cue the music: “Bad boys, bad boys, what you gonnado....”