Spotify Sued $1.6 Billion for Failure to Obtain Proper Song Licenses

Spotify has been hit with a $1.6 billion lawsuit for allegedly using artists’ music without a license or compensation, according to recently filed court documents.

The suit was filed against the music streaming giant in a California court last Friday by Wixen Music Publishing. The Calabasas, California-based Wixen represents high-profile artists ranging from The Black Keys to Tom Petty, among about 200 others.

Wixen argues that Spotify, “in a race to be first to market” in the U.S., didn’t put forth enough effort to identify the actual holders of the rights to the songs it licenses from record labels. Wixen’s lawsuit alleges that Spotify has been using “thousands of songs” without the correct license.

The lawsuit centers around the fact that, according to the U.S. Copyright Act, there are two separate copyrights for recorded songs. One for the actual audio recording, and another for the musical composition, which comprises the song’s musical notation and lyrics. Wixen is claiming that Spotify only has the licenses for the sound recordings, and not for the musical compositions.

There are, in fact, more than 10,000 songs listed in the lawsuit, including Tom Petty’s “Free Falling,” Rage Against the Machine’s “Calm Like A Bomb,” and others. Wixen is seeking the maximum award possible for each song under the Copyright Act — $150,000 — CNN reported on Wednesday.

The streaming giant has long been at the center of a dispute over streaming rights compensation, and how it is split between record labels and publishing companies. Wixen’s lawsuit comes on the heels of a $43 million settlement with publishers and songwriters proposed by Spotify in May 2017.

Spotify is also currently facing three other lawsuits filed by songwriters and publishers in Tennessee, Variety reported. For those suits, the accusers are alleging that Spotify used songs without paying royalties to the appropriate parties.

The Wixen lawsuit is only the latest roadblock for Spotify, and it mars the company’s recently cemented plans to go public on the New York Stock Exchange, according to Rolling Stone. The streaming giant is currently valued at $19 billion and is expected to list its shares on the NYSE sometime this year.