In a significant development in the nascent YouTube MCN (Multi Channel Network) space in India, YouTube India star Shraddha Sharma has won her case against the YouTube MCN Culture Machine in the Bombay High Court, reports Radio and Music. Sharma was earlier taken to court by Culture Machine over an alleged breach of contract.

The Bombay High Court order, a copy of which is with Medianama, has directed Culture Machine to handover the admin rights of Sharma’s YouTube channel Shraddharockin to her.

In an emailed response to MediaNama, a Culture Machine spokesperson said:

Our endeavor has always been to promote talent through Channels. We have helped build reach, viewership and loyalty for every talent that has signed on with us. We take pride that we have provided Shraddha with a platform which has enabled her talent to reach the world and build her imagery. We wish her all the best in the future.

Sharma had earlier mentioned that Culture Machine had filed a case against her following her decision to not renew the agreement with them. Culture Machine co-founder Sameer Pitalwalla had told in an emailed response to Medianama that they had signed a contract with Sharma which she had breached. Following this, Sharma had launched another channel called SupagirlShraddha.

While we are not familiar with specifics of Sharma’s contract, the Bombay HC order suggests that the primary issue between Sharma and Culture Machine was over the right of first refusal clause in her contract.

The Radio and Music report mentions that a district court had earlier dismissed Culture Machine’s plea to restrain Sharma from entering into any negotiations with any third party for managing her YouTube channel, saying that right of first refusal cannot be enforced in a personal services contract. It also adds that Culture Machine had not handed over the channel admin rights to Sharma despite the ruling.

Interestingly, Sharma had released a video on Facebook in September this year wherein she had urged other artists intending to work with MCNs to not to share their YouTube passwords. She also mentioned that “the language used in these contracts is very complicated and technical for artists like us or any person entering the industry to understand, so its better that you ensure you know what’s written in the contract”.

The Qyuki connection

It’s worth noting that Sharma was signed up by Universal Music last year, wherein Universal was expected to manage endorsements, albums appearances and live performances among others. Devraj Sanyal, MD of Universal Music Group & EMI for South Asia, had told MediaNama – “In our world, we call it a 360 degree contract which means we run everything for her, including endorsements, albums appearances, live…everything.”

In July this year, Universal Music had also signed a “strategic and operational” deal with another YouTube MCN Qyuki, for doing content around music from Universal Music Group (UMG), and its affiliated publishing entity, Universal Music Publishing Group. While its not clear whether Qyuki was in discussions with Sharma for YouTube management, we noticed that Sharma is currently mentioned as one of the featured artists on Qyuki homepage. Update: Qyuki has confirmed that Shraddha Sharma has signed up with them.

Qyuki Shraddha Sharma

That being said, Sharma had earlier told Medianama that she will be handling her own channel for now. In an interview to SoundBox in September, Sharma had told that she is “too shocked working with one MCN to care about signing with anyone else for now”.

What happens when an artist quits?

The YouTube MCN market is still fairly nascent in India, which makes it more important for artists to make sure they decide on who owns the channel and content when they decide to leave the network, something which Sharma also mentioned in the video.

It also needs to be decided whether an artist can upload the same videos on their new channel or reuse the content in their future videos. The music business has had a similar history of vague contracts, and uncertain terms of the deal, which have led to ambiguity in relationships.

This also reminds me of a similar case between YouTube star Ray William Johnson and YouTube MCN Maker Studios in December 2012, wherein Johnson had mentioned a series of complaints against Maker Studios and also alleged that they were refusing to give back his Adsense account even after the contracts had expired.

Updated: Headline changed.