Spotify Sued for $150,000 Per Song - $16B

Wixen Music Publishing are suing streaming giant Spotify for at least US $1.6 billion. Wixen, who filed the lawsuit on the 29th December 2017, represent artists including Tom Petty, Neil Young, Missy Elliot, The Doors and Rage Against The Machine. The figure of US$150,000 per song is the maximum damages award possible under US copyright laws. Wixen estimate that their artists’ music represents between one and five percent of the music streamed on Spotify.

They claim that Spotify is under-paying songwriters by hosting thousands of songs from the Wixen catalogue without the necessary mechanical copyright licences or compensation. In May of 2017, Spotify reached a US$43 mn. settlement with songwriters Ferrick and Lowery over mechanical copyright infringements, however MBW reported that Wixen declined to participate in this offer as they considered the compensation offered inadequate.

The timing of this lawsuit is related to a particular provision within the Music Modernisation Act, a new piece of US legislation aimed at simplifying and updating the process of licensing music in the digital era. The bill affects a publishers ability to sue streaming services for infringing mechanical copyrights after Jan 1st, 2018. Wixen President Randall Wixen said:

“We are very disappointed that these services will retroactively get a free pass for actions that were previously illegal unless we actually file suit before January 1, 2018…We regret that this otherwise admirable proposed bill has had this effect, and we hope that Spotify nonetheless comes to the table with a fair and reasonable approach to reaching a resolution with us…we estimate that our clients account for somewhere between 1% and 5% of the music these services distribute. Spotify has more than $3 billion in annual revenue and pays outrageous annual salaries to its executives and millions per month for ultra-luxurious office space in various cities.”

Spotify is currently valued at US$19 bn.