×

Spotify Hit With $1.6 Billion Lawsuit From Publisher Representing Tom Petty, Neil Young, Others

UPDATED: Spotify has been hit with a $1.6 billion lawsuit from Wixen Music Publishing, which handles titles by Tom Petty, Neil Young, Steely Dan’s Donald Fagen, Weezer’s Rivers Cuomo, Stevie Nicks, and others. The suit, which alleges that Spotify is using thousands of songs without a proper license, was filed on Dec. 29 in California federal court. It is seeking damages worth at least $1.6 billion and injunctive relief.

Spotify has been plagued by complaints and legal action from the music-publishing industry, which widely feels that labels are getting the fairer share of royalties from the company. In May the company proposed a $43 million settlement to resolve a class-action suit from a collective of songwriters, including David Lowery and Melissa Ferrick, that in September was lambasted as being inadequate by a group of songwriters and actors; more lawsuits ensued.

Wixen’s lawsuit says the proposed settlement “does not adequately compensate Wixen or the songwriters it represents.” The suit continues, “Prior to launching in the United States, Spotify attempted to license sound recordings by working with record labels but, in a race to be first to market, made insufficient efforts to collect the required musical composition information and, in turn, failed in many cases to license the compositions embodied within each recording or comply with the requirements of Section 115 of the Copyright Act. Either a direct license from Wixen or a compulsory license would have permitted Spotify to reproduce and/or distribute the Works as part of the Service, including by means of digital phonorecord deliveries (“DPDs”), interactive streaming, and limited downloads. But Spotify failed to obtain either license type,” and instead outsourced that role to the Harry Fox Agency, which the suit says “Spotify knew … did not possess the infrastructure to obtain the required mechanical licenses and Spotify knew it lacked these licenses.”

Spotify filed court papers on Friday that questioned whether Wixen’s clients had authorized the company to take that action, claiming that it had given its clients only a brief opt-out period before their names would be included in the suit.

In a statement released Tuesday afternoon, company president Randall Wixen clarified that it and its clients are not taking part in the Music Modernization Act introduced late in December, which aims to simplify digital licensing and increase rates, or joining the class-action suit “in part because of their belief that the proposed settlement is inadequate, because too much of the settlement is going to legal fees, and because the terms of the go-forward license in the settlement are not in their long-term best interests.” Instead, the company says it “was and is desirous of sitting down with Spotify to work out an amicable settlement for its past infringements and unlicensed uses, and seeks to work out a go-forward license which is fair to all parties.

We’re just asking to be treated fairly,” he continued. “We are not looking for a ridiculous punitive payment. But 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. All we’re asking for is for them to reasonably compensate our clients by sharing a miniscule amount of the revenue they take in with the creators of the product they sell.”

A rep for Spotify declined Variety’s request for comment.

(Pictured: Spotify CEO Daniel Ek.)

More Digital

  • La unidad

    Berlin: European VODs Innovate, Create to Stay Afloat in Global Streaming Wars

    Netflix and other streaming giants might be setting the pace for a global TV landscape upended by video-on-demand technology, but European players are shaking up domestic markets by ramping up investment in original production, forging unlikely partnerships, and looking to beat Netflix at its own game by finding innovative ways to personalize the VOD viewing [...]

  • ABC News Live - David Hatcher

    ABC News Live Taps BuzzFeed's David Hatcher to Oversee Morning News Programming

    ABC News has recruited veteran TV producer David Hatcher as executive producer to oversee the morning news programming block for the ABC News Live streaming network. Hatcher most recently spent a year at BuzzFeed, where he was executive producer of morning news show “AM2DM” on Twitter. For ABC News Live, Hatcher will be responsible for [...]

  • Netflix-logo-N-icon

    Netflix Launches Top 10 Daily Rankings of Most Popular Titles by Country

    Netflix is taking top 10 lists of its most popular streaming content to members across the globe. Starting Monday (Feb. 24), Netflix said, it is rolling out a new row in its interface that will show the overall top 10 titles in a subscriber’s country, as well as the top 10 most popular series and [...]

  • Parasite

    'Parasite' Will Stream Exclusively on Hulu in U.S.

    Hulu has exclusive U.S. streaming rights to “Parasite,” the film that made history as the first foreign-language film to win best picture at this year’s Oscars. Under a deal with indie studio Neon, “Parasite” will be available on Hulu beginning Wednesday, April 8, the Disney-controlled streamer announced. The movie from filmmaker Bong Joon Ho won [...]

  • media stocks - wall-street

    Disney, Amazon, ViacomCBS Shares Hit as Stock Market Tumbles Amid Coronavirus Fears

    Fears of the Coronavirus spreading across the world sent major stock indices tumbling on Monday morning. Shares of Disney and Amazon were down 4% for the day as reports that the deadly virus has hit South Korea and Italy spooked investors. The Dow Jones Industrial Average was down more than 1,000 points, or 3.5%, at [...]

  • Disney-Plus-Logo

    Disney Plus Launches Plan Discounts in U.K., Europe Ahead of March Debut

    Disney, looking to lock in Disney Plus customers in the U.K. and European markets prior to its official launch next month, is offering 14%-17% discounts on the streaming service — if users sign up for a one-year plan. Leading up to the March 24 debut of Disney Plus in the U.K., Ireland, France, Germany, Italy, [...]

  • Alex Dundas - Whistle

    Whistle Hires Ex-ITV Exec Alex Dundas as Head of Unscripted Originals (EXCLUSIVE)

    Digital-media company Whistle recruited Alex Dundas, most recently with ITV Entertainment, as executive VP and head of unscripted premium originals. Based in Whistle’s L.A. office, Dundas will oversee development and packaging of new unscripted shows from Whistle and also will support sales to TV network and streaming partners. He reports to Dominic Ianno, EVP of [...]

More From Our Brands

Access exclusive content