Spotify was hit with a lawsuit for $1.6 billion from Wixen Music Publishing that handles titles by Neil Young, Donald Faven, Rivers Cuomo, Tom Petty, and Stevie Nicks amongst others.
The suit alleges that Spotify uses thousands of songs and does not have the proper license to do so. The suit was filed on December 29 in a federal court in California. It seeks damages of a minimum of $1.6 billion as well as injunctive relief.
Music-publishing industry complaints as well as legal action have plagued Spotify. The industry overwhelmingly feels the labels are getting a fairer share of royalties from Spotify.
The company in May proposed a settlement of $43 million to resolve one class-action case from a group of songwriters that included Melissa Ferrick and David Lowery that last September was criticized for not being adequate by another group of actors and songwriters.
The lawsuit by Wixen says the settlement proposed does not compensate adequately Wixen or those songwriters it represents.
It continues by saying prior to Spotify launching in the U.S. it attempted to license sound recording through working with labels but, in its attempt to be first into the market, did not make the efforts to collect all the required information for musical composition and thus failed in many instances to license compositions that were embodied in each recording.
Either a license direct from Wixen or obtaining a compulsory license was enough to permit Spotify to distribute and/or reproduce as part of its service, read part of the suit.
Spotify on Friday filed its own court papers questioning whether the client of Wixen authorized it to take action, claiming its clients only received a brief opt-out frame prior to their names being included as part of the suit.
Tuesday afternoon, in a prepared statement, Randall Wixen the company president clarified that it, it as well as its clients were not part of the Music Modernization Act that was introduced in late December that aims to make digital licensing simpler and increase the rates.
Instead Wixen said the company was and remains interested in working out a settlement with Spotify for past infringements and its unlicensed uses, while seeking to work out a license for going forward that is fair to all involved.
He added that all they want is to be treated fairly and do not want any outrageous punitive payment.