David Lowery has filed an attempted class action lawsuit against Spotify, charging that the streaming service knowingly and willingly distributed music without the correct mechanical licenses. The former musician and artist rights advocate has hired Michelin & Robinson to represent his interests.
Lowery has long been a vicious critic of most streaming models, but this formal legal action appears to have sparked from the recent issues between Spotify and Another Victory Music Publishing. After an audit by digital licensing expert Audiam, Another Victory determined that it was owed unpaid royalties from the streaming service. Spotify removed the songs in question for a few days in the U.S. Spotify did reach an arrangement with the publisher and returned the songs to the platform. A few weeks later, the company announced that it would work to build an internal database for royalties management.
The complaint calls out Spotify as “publicly” admitting that it had not obtained licenses for a chunk of its library. Spotify’s announcement acknowledges that rights ownership of the tracks played on the service are not always evident enough to generate payment; in those cases Spotify sets aside the royalty money in a kind of escrow account.
Lowery is firstly suing for damages inflicted on his own music. Secondly, the lawsuit assumes a (so far unspecified) class invited to join the action, which the filing numbers in the “hundreds of thousands.”
David Lowery appears to be jabbing a sharp stick into what many industry observers have called a black box of music rights ownership. Spotify’s recently announced commitment to build an internal rights administration division is viewed as an admission of guilt by Lowery’s lawsuit (which filing can be read here), but Spotify’s announcement is framed as Spotify taking a leadership position in solving (for itself) an industry-wide problem — Spotify is hardly the only music service which outsources the royalty payment tangle, industry sources have told RAIN News.
RAIN News received the following statement from Jonathan Prince, Spotify’s Global Head of Communications: “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. We are working closely with the National Music Publishers Association to find the best way to correctly pay the royalties we have set aside and we are investing in the resources and technical expertise to build a comprehensive publishing administration system to solve this problem for good.”