Trent Reznor Bares Teeth In Testimony Against Ex-Manager

Nine Inch Nails mastermind is suing former business associates for millions.

By Chris Harris for MTV on May 17, 2005

Did Trent Reznor's former manager John Malm bite the hand that feeds? According to testimony offered by the Nine Inch Nails architect in U.S. District Court in New York, Malm didn't just bite that hand, he tore it clean off.

Reznor's civil

"John [Malm] was the business guy, and I was the guy working for nothing in the studio." — Trent Reznor

Reznor's civil trial against Malm opened in Manhattan on Monday, with the Nine Inch Nail painting a traitorous portrait of his former handler and friend, The Associated Press reports. Reznor filed the civil action against Malm and former business manager and accountant Richard Szekelyi nearly one year ago, charging his former associates with fraud and breach of fiduciary duties (see "Trent Reznor Sues Ex-Manager For Millions").

The industrial rocker's suit claims that Malm and Szekelyi's Ohio-based company, J. Artist Management, engaged in unlawful and immoral conduct for years, cheating Reznor out of millions of dollars that rightfully should have gone to him.

On Monday, Reznor told jurors he trusted Malm, and was hence tricked into signing a contract that permitted his former manager to collect 20 percent of his gross earnings, rather than his net earnings — the latter being the typical method by which artist managers are compensated.

According to the suit, Malm and Szekelyi's management agreement gave them 20 percent of all gross monies paid to or earned by Reznor, even if the musician decided to secure new management; that includes 20 percent of all album advances, including those not yet recorded.

Malm allegedly stole or mismanaged up to million of the musician's money, according to the suit.

"I felt I had an accountant I couldn't trust," Reznor told the court, according to the AP.

Malm's lawyer, Alan Hirth, countered Reznor's claims in his opening statement, saying his client toiled for years pro bono and never kept the musician's business dealings secret. "Of the millions upon millions upon millions that Trent Reznor and Nine Inch Nails made, the vast majority went into [Reznor's] pocket," Hirth said.

Reznor admitted before the court that he ignored his finances for the most part, and entrusted the handling of his business dealings to Malm, often signing papers and documents without reviewing them.

"John was the business guy, and I was the guy working for nothing in the studio," Reznor said, according to the AP.

Reznor claims he had no reason not to trust Malm — until 2003, when he asked Malm how much money he had. The rocker told the court he was provided with a financial statement that put his total assets at million, with just over 0,000 in cash.

"It was not pleasant discovering you have a 10th as much as you've been told you have," Reznor said, later explaining that he started to fully comprehend his financial situation several years ago, after tackling his addiction to drugs and alcohol.

Nine Inch Nails' latest album, With Teeth, opened at #1 on last week's Billboard album sales chart, with first-week scans of more than 272,000 (see "Nine Inch Nails' With Teeth Devours Chart Competition").

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