Last week, the music world buzzed with news as Neal Schon and Jonathan Cain dismissed veteran members Ross Valory and Steve Smith from Journey.
The duo accused the former bandmates of attempting a misguided takeover to gain control of the band’s iconic name. In a legal move, Schon and Cain sought over $10 million in damages. Yet, the startling revelations didn’t end there. Legal documents shed light on more than just the recent dispute, delving into the financial arrangements set after lead vocalist Steve Perry exited the band.
Back in 1986, Schon, Cain, and Perry had collectively trademarked “Journey.” However, Perry’s departure led to a revision in their agreement, granting Schon and Cain rights over the band’s name, but with significant financial obligations.
Under the new terms, for the first two albums released without Perry, Neal Schon and Cain agreed to pay him half of the net earnings from those albums, based on the higher income between the two. The percentage owed to Perry would decrease with subsequent albums – 25% for the third and 12.5% for any further studio albums.
The financial ties didn’t stop at album sales. Perry also secured a substantial share of the profits from Journey’s tours, even though he no longer performed with them. For the initial two tours without Perry, he would receive half of the net tour income. The amount would reduce to 25% for the following tour and 12.5% for each one thereafter, with the net income defined as the larger share of earnings between Schon and Cain.
