Ultra Music Festival Wins Lawsuit Against Alex Omes; Estate Appeals Decision

A judge has ruled in Ultra Music Festival's lawsuit against the late cofounder Alex Omes.
A judge has ruled in Ultra Music Festival's lawsuit against the late cofounder Alex Omes.
Photo by George Martinez

Update: An autopsy by the Miami-Dade County Medical Examiner reveals a possible cause of Alex Omes' death. Although his death was listed as undetermined, a toxicology report found amphetamines, ketamine, cocaine, and GHB in Omes' blood.

Before he suddenly and mysteriously died last year, Miami nightlife fixture and Ultra Music Festival cofounder Alex Omes was fighting to regain control of the popular electronic music event he helped create. After being pushed out of his role as president of the festival, Omes sued the fest for $33 million, the amount he said his shares of Ultra were worth.

One year later, a court has decided the case. Circuit Court Judge Jennifer D. Bailey has ruled in favor of Ultra, concluding that because there never was an employment contract between Omes and the festival, Omes' estate does not have rights to the event.

Bailey also ruled that Ultra is worth far less than Omes claimed in his lawsuit and that his family is entitled to $720,000 at most.

"Ultra Enterprises Inc. is extremely pleased with the outcome of [the] trial held in November," an Ultra spokesperson tells New Times, "and hopes that the parties may now resolve what is left of the matter amicably and without further expenditure of the resources of the court or the parties."

Omes' estate plans to appeal the verdict but declined to otherwise comment on the ruling. 

Omes, who was born in Argentina but grew up in Miami, cofounded Ultra in 1999 as a small South Beach EDM festival with his business partner, Russell Faibisch. The festival exploded during the next decade, growing into a three-day party that draws more than 100,000 ravers. Spinoffs launched in Brazil, Croatia, Chile, South Korea, and elsewhere. 

Omes sued Faibisch in 2012. At the center of his lawsuit: his claim that when Ultra was formally incorporated, he was a 54 percent shareholder and the festival's designated president. He said Faibisch and others improperly forced him out of control. 

Ultra countersued, though, claiming Omes was "engaging in self-dealing and acts of bad faith which were harmful to Ultra Enterprises."

The day before the case was set to go to trial — January 12, 2015 — Omes unexpectedly passed away. The cause of death is still not clear. Police found cocaine in his condo, but an official autopsy report is not complete, the Miami Medical Examiner's Office tells New Times.

Alex Omes
Alex Omes
Courtesy of Emi Guerra

After Omes' death, his brother Carlos vowed to continue the legal fight. But this past January 13, Judge Bailey ruled against the cofounder's claims, writing that without a binding contract, Omes' estate had no legal rights to the festival's management. 

And what of the $33 million Omes wanted for his shares? Bailey found that estimate to be overblown. The judge said the valuation by Omes' accountant, Edward Deppman, was made with "a variety of invalid assumptions not supported by evidence."

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Bailey instead set the full value of Ultra at only $2.4 million, saying, "Ultra is like other startups in the 21st Century. They may be very famous, such as Amazon, but it takes a long time to make money because they require significant reinvestment to grow the brand." Therefore, Bailey ruled that Omes' 30 percent interest in Ultra is worth $720,000.

The court's findings did reveal more of the motives behind Omes' being pushed out of Ultra's management.

According to the court, "Omes was a strong personality who caused conflicts with Ultra business relationships." There was also the accusation that Omes was using Ultra to benefit his other businesses outside of the festival. Ultra's shareholders worried that by doing so, Omes was "diminishing the uniqueness of [the festival]" and reducing its value.

Email evidence and testimony showed that Faibisch tried to get Omes to stop and concentrate on the festival and that Omes ignored the requests.

Ultimately, what got between Ultra and Omes was a musical act: Swedish House Mafia.

Ultra booked the DJ supergroup for its 2010 festival. A few months later, Omes helped bring the trio back to Miami for Masquerade Motel in midtown Miami, one of Omes' dance music events that Ultra considered to be direct competition.

According to evidence, Faibisch had warned Omes: "[You're positioning] yourself as an enemy of the festival and your partners; you need to become a contributing partner and work as a team player. Why is it literally every time you get involved in operations... it is all drama, problems, or costs Ultra money?"

Omes' continued refusal to fall in line ultimately led to his ouster. In August 2010, Ultra's board of directors removed Omes as president, and in 2012, the shareholders met to amend Ultra's bylaws to prohibit self-dealing and competition with the festival by its shareholders. Fabisch, his brother Charles, and Adam Russakoff, who represented 70 percent of the festival's stock, agreed on the new rule.

Omes was notified of the shareholders' actions, and they paid him $360,000 for his shares in the festival.

The legal fight over Omes' legacy isn't over, though. On February 11, Omes' estate filed an appeal. Joel S. Magolnick, Omes' attorney, says that "the estate does intend to proceed with the appeal." 


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