The Beatles have been given the go-ahead to sue EMI and Capitol Records for millions of pounds allegedly due in royalties for records they had been told were destroyed or damaged but then sold.
The group wants at least $25 million (£13.2m) in damages in the suit for fraud and breach of contract. They are also seeking to reclaim rights to all the band’s master recordings.
Last week a judge at New York State Supreme Court, Justice Karla Moskowitz, denied EMI’s request for the claim to be thrown out.
The plaintiffs are Sir Paul McCartney, Ringo Starr, John Lennon’s widow Yoko Ono, the estate of the late George Harrison and the Beatles’ company Apple Corps.
The lawsuit, filed in December, claims EMI and affiliate Capitol wrongly classified copies of Beatles recordings as destroyed or damaged "scrap" but then secretly sold them.
It also alleges that the number of units sold was under-reported, and that the firms classified some recordings as "promotional" and therefore non-royalty bearing, but then sold the material.
On top of the $25m, the band also wants unspecified punitive damages to be decided at trial.
It claims the lawsuit was triggered by an audit of the companies’ books from the period 1994 to 1999, which uncovered allegedly deceitful behaviour.
The dispute between The Beatles and EMI and Capitol dates back to 1979, when the band alleged they had been underpaid by more than $20 million (£10.5 million). That case was settled 10 years later, with the band and Apple getting increased royalty rates.
EMI and Capitol had argued in the current case that the plaintiffs had failed to give enough detail of the circumstances of the allegations or state a cause of action. In court papers, they said that the fraud claim was an attempt to "dress up a contract claim".
The Beatles’ lawyer, Paul LiCalsi, said: "We are delighted to have the opportunity to pursue this claim for the return of the Beatles’ master recordings."