Hi Steve,
I don't see why this should cause people problems.
We have researched this fully and taken professional advice, and our use of the design is perfectly legal. The label design (unlike the logo) is fully unencumbered, and we hope to (after a fair period of use) be able to trademark it's use ourselves.
There is no such thing label artist royalties. If there were we would have paid them. But there isn't.
Just like when I was involved with the reactivated Soul City some 10 years ago, We used not onl;y the label design, but also the logo. There were no label artist royalties to pay. As a courtesy we infomed Dave Godin what we were doing and got his blessing.
Cheers
Phil