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Soundwave WA Bar Operator Altered State Declared Insolvent

Written by Nastassia Baroni on June 6, 2014

Correction: We previously named Altered State as promoters for the Perth leg of Soundwave Festival, as reported in The West Australian. Soundwave promoter AJ Maddah has contacted Music Feeds to say “it is the bar operator in WA that is declared insolvent due to legal action by SW. They are not and have never been a promoter for Soundwave. We fired them last year.” This story has been updated to reflect this new information.

A legal dispute over hundreds and thousands of dollars worth of bar profits has resulted in bar operators of the Western Australian leg of Soundwave, Altered State, declared insolvent.

The West Australian reports, a Federal court last week granted an application brought forth by Soundwave chief AJ Maddah, to shut down the Altered State company run by brothers Chris and Ken Knight.

The dispute centred on a $1 million bar profit made at last year’s festival, headlined by Metallica, Linkin Park and Blink 182. Soundwave argued Altered State still owed them $340,690.46 from takings, under an agreement that the festival was to receive 70% of bar profits from the Claremont Showgrounds event.

Altered State said they had already paid one instalment of $350,000, but were holding back the second payment, claiming that Maddah still owed them almost $500,000 from unpaid expenses and management fees from previous festivals.

However Federal Court Justice Michael Wigney ruled against brothers Chris and Ken Knight in the legal proceedings, saying their lack of paperwork and business records meant they couldn’t substantiate their claims.

“Given the size of the events and the amount of revenue generated, it is somewhat surprising that the arrangements between the parties appear, at least on Altered State’s version of events, to have been dictated by nothing more than discussions, custom and practice,” Justice Wigney wrote.

According to court documents obtained by The West Australian, the counsel representing Altered State sought to explain the lack of a paper trail with a concise justification of, “That’s rock’n’roll’.”

Neither of the Knight brothers nor AJ Maddah have commented publicly on the court’s decision.

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