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Spotify sued for US$150 million over unpaid royalties

By Kenny Yeo - on 30 Dec 2015, 9:58am

Spotify sued for US$150 million over unpaid royalties

Spotify is being sued in a class action lawsuit that is demanding US$150 million in damages over unpaid royalties.

The class action lawsuit is being filed by musician David Lowery, the frontman of bands Cracker and Camper Van Beethoven. It alleges that Spotify "knowingly, willingly, and unlawfully reproduces and distributes copyrighted compositions without obtaining mechanical licenses."

Lowery claims Spotify is illegally sharing songs from his band Cracker, including "King of Bakersfield", "Almond Grove" and "Tonight I Cross the Border".

According to reports, Lowery will represent a group of over 100 members who are equally disenchanted and frustrated with the service.

Interestingly, it seems that Spotify is well aware that some of the content that it hosts infringes on copyright and sets aside a reserve - said to be between around US$20 million - that it uses for the sole purpose of paying royalties to artists that were never properly distributed.

Spotify's Global Head of Communications, Jonathan Prince, said, "We are committed to paying songwriters and publishers every penny. 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."

Source: Billboard, The Verge