Musicians Sue Spotify for $150 Million Over Unpaid Royalties
Spotify has been hit with a $150 million class action lawsuit that alleges the streaming service has knowingly reproduced and distributed copyrighted music without obtaining the proper licenses, Billboard reports.
Camper Van Beethoven and Cracker frontman David Lowery is fronting the suit, filed in the Central District Court of California through the law firm of Michelman & Robinson, LLP. It accuses Spotify of failing to find and pay composers and songwriters of tracks provided to its over 75 million users, as well as not issuing a notice of intent to employ a compulsory license.
Lowery’s lawsuit comes as Spotify continues to negotiate a settlement with the National Music Publishers Association over similar issues of improperly licensed music and outstanding royalty payments. Spotify has reportedly set aside $17 million to $25 million to pay royalties for pending and unmatched song use, and Lowery’s complaint points to this slush fund as proof that Spotify has knowingly been breaking the law.
“We are committed to paying songwriters and publishers every penny,” Spotify’s head of communications and global policy, Jonathan Prince wrote in a statement. “Unfortunately, especially in the United States, the data necessary to confirm the appropriate rightsholders is often missing, wrong, or incomplete. When rightsholders are not immediately clear, we set aside the royalties we owe until we are able to confirm their identities. We are working closely with the National Music Publishers Association to find the best way to correctly pay the royalties we have set aside and we are investing in the resources and technical expertise to build a comprehensive publishing administration system to solve this problem for good.”
The lawsuit — which names songs from Cracker’s 2014 album, Berkeley to Bakersfield — also entered an order to appoint Lowery as the class representative, and his counsel as class counsel. By positioning itself as a class action, the lawsuit can encompass a wide swath of musicians who believe they have been similarly wronged by Spotify. The suit alleges that members of the proposed class will exceed 100 and can easily be identified by searching Spotify’s own database files and records.
The suit further asked the court to instruct Spotify to hire a third party auditor to identify the songs on Spotify that were streamed without a proper mechanic license; prohibit further copyright infringement; and remove all unlicensed songs until the service obtains the proper permits.
The suit notes that the statutory penalty for each infringed work can be between $750 and $30,000, and up to $150,000 per song for willful infringement. Lowery is hoping to secure full restitution on gross profits, as well as compensatory damages, statutory damages for penalties authorized by the Copyright Act, legal fees and pre- and post-judgement interest on monetary awards.