×
You will be redirected back to your article in seconds

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

  • Michael Uslan's U2K Becomes Asia-Hollywood Formats

    Michael Uslan's U2K Becomes Asia-Hollywood Formats Pipeline (EXCLUSIVE)

    Michael and David Uslan, the father and son producing team with credits that include “The Dark Knight” and “Sabrina: Secrets of a Teenage Witch” have struck a cluster of deals that makes them a two-way conduit for TV formats between Hollywood and Asia. U2K, a company that includes the Uslans and Jon Karas (“Believe in [...]

  • Dish Testing Flixpert Content Recommendation Service

    Dish Tests Movie Recommendations App Flixpert (EXCLUSIVE)

    Dish and its corporate sibling EchoStar have quietly been testing a movie recommendations platform called Flixpert, Variety has learned. Flixpert promises to help people find movies to watch through recommendations from friends and trusted contacts; Dish has been testing mobile apps for the service with a few hundred users. Online footprints suggest that Flixpert has [...]

  • Craig Hunegs WB

    Craig Hunegs to Exit Warner Bros. TV Group and Digital Networks (EXCLUSIVE)

    After nearly 25 years in the Warner Bros. family, Craig Hunegs is exiting his post as head of business for Warner Bros. TV Group and president of the studio’s digital networks wing. Hunegs said he has been discussing his exit with Warner Bros. chairman-CEO Kevin Tsujihara for the past several months. At a time of [...]

  • Google Placeholder

    Google Accelerates Google+ Shutdown Following New Privacy Mishap

    Google will shutter its struggling social network Google+ sooner than previously announced: The company said Monday that Google+ will shut down in April of 2019. It also disclosed a new security vulnerability that briefly exposed personal data of some 52.5 million Google+ users. The bug, which was introduced to Google+ in November, allowed developers to [...]

  • Eddie Lazarus Sonos

    Sonos Hires Tribune General Counsel Eddie Lazarus as Chief Legal Officer

    Smart speaker maker Sonos has hired former Tribune exec Eddie Lazarus as its new chief legal officer. Lazarus will be in charge of all legal, regulatory, compliance and SEC reporting issues, among other things. Prior to joining Sonos, Lazarus worked as general counsel and chief strategy officer for Tribune Media. Before that, he was chief of [...]

  • Rhapsody, Sony Music to Launch Spotify

    Rhapsody, Sony Music to Launch Spotify Competitor in Japan

    Rhapsody and Sony Music Entertainment today announced a partnership to launch what they describe as the first on-demand, high-resolution streaming music service in Japan. Rhapsody International is providing its “Powered by Napster” platform including a set of systems, tools and APIs to allow SMEJ to quickly launch and bring its on-demand service to market. The service, [...]

  • Vidcon Sarah Tortoreti

    VidCon Has a New Marketing Chief: Nickelodeon's Sarah Tortoreti

    VidCon tapped Sarah Tortoreti as VP of marketing to head up the digital-creator and video confab’s promotional strategies worldwide. Tortoreti joins VidCon from Viacom’s Nickelodeon, where she was director of marketing and brand strategy since April 2016. In early 2018 Viacom acquired VidCon, founded by veteran YouTube creators Hank Green and John Green. In the newly [...]

More From Our Brands

Access exclusive content