THE CASTLE BANK OF NASSAU STORY
The original contracts with Fantasy were signed when Tom Fogerty was the only one of
the band members of legal age. (1)
During the life of CCR, the band members were in a constant battle with Fantasy/Saul
Zaentz for more than the measly percentage they were originally signed for. The original
contract was standard at the time, but Saul Zaentz promised the band members, "When
you're successful, we'll give you a new deal, and we'll all share in the pie." (1, 3)
During this same time period, John Fogerty was acting as business manager and CCR
themselves frequently did their own public relations work such as advertisements in
Billboard magazine, a fan club and standard PR with record dealers such as color posters,
etc. (2)
During the CCR days, John Fogerty was so immersed in the writing of the music and
controlling the direction of the band, he was lacking in his capacity as manager of the
band's financial affairs. This matter became a major point before Tom left, and
thereafter. (3)
Fantasy Records was incredibly non-appreciative of the music and success of CCR,
despite their bank accounts soaring from CCR's record sales. (1)
While CCR was still active, Fantasy Records/Galaxy Records/Saul Zaentz Co. lawyers and
accountants persuaded the band members to have their song and record royalties be held in
a trust account at Castle Bank of Nassau, the same controversial bank that Fantasy Records
executives had a trust account. The reason for this was tax break/shelter related.
Specifically, Saul Zaentz persuaded John this "tax break" would equal a royalty
increase. John then convinced the other band members. The tax plan required both Fantasy
and CCR to have accounts at the Castle Bank. (3, 4)
Tom Fogerty decided to leave CCR during the recording of "Pendulum", in the
fall of 1970. His reasons were stated that he wanted to contribute more to CCR, and sing
lead on a few songs. John Fogerty was reluctant to change things within the style of CCR,
and would not give up any of the control he'd gathered from the rest of the band, so Tom
left. (1, 2, 3)
CCR continued as a three piece act until disbanding in 1972 by mutual decision. (3, 4)
During the early 1970s, attempts were consistently made to have the Bahamian trusts
converted to individual accounts elsewhere. The Castle Bank eventually surrendered its
Bahamian charter in 1977, moving to Panama, where it dissolved. (4)
John Fogerty filed the original suit in March 1978 in Santa Barbara, CA. In February
1980 the other three group members filed a similar suit in San Francisco Superior Court.
The two suits were consolidated for hearing. Fogerty's original suit was against
defendants Burton Kanter, a Chicago attorney, Edward J. Arnold, an Oakland accountant, and
Barrie D. Engel, an Oakland attorney. They were charged with professional malpractice,
fraud and breach of fiduciary duty. The suit asked for $10 million in damages. (4)
On April 29, 1983, a jury in San Francisco Superior court ruled in favor of Fogerty,
Clifford, Cook, and Fogerty and awarded $8.6 million. John Fogerty was awarded
approximately $4.1 million, while his group mates each got approximately $1.5 million.
Kantor and Engel were understood to have made settlements of $1.5 million each. Kenneth I.
Sidle of Irell & Manella in Los Angeles represented John Fogerty, and John W. Herron
represented the three other group members. (4)
Sources: 1) Tom Fogerty interview on audio tape.
2) John Fogerty interview on audio tape.
3) Stu Cook statements via Internet.
4) Billboard Magazine, May 14, 1983.
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