Slacker tells judge that $10M royalties judgment could drive it into bankruptcy

According to a report yesterday in Billboard (here but may be behind a paywall), lawyers for Slacker Radio and its parent company LiveOne are arguing to a federal judge that last week’s $10 million judgment for unpaid music royalties to SoundExchange (see RAIN story here) could drive the company into bankruptcy if not reversed.

LiveOne claimed that the decision had caused creditors to call in other debts owed, and that being forced to pay the judgment would make the company “unsustainable.” 

In response, SoundExchange’s lawyers argued, “Five years is long enough. SoundExchange has no obligation to negotiate ad infinitum with defendants, who have demonstrated at every opportunity that they will leverage the creativity of others without compensation.”

SoundExchange’s response continued, “Defendants’ contention that the judgment poses an existential threat to their business is difficult to square with their lackadaisical approach to finding counsel and subsequent non-adherence to the court’s deadlines.”  (LiveOne apparently failed to hire lawyers to respond at all to certain aspects of the case as it was being argued.)

“Since SoundExchange filed this lawsuit in July 2022,” the SoundExchange filing noted in a footnote, “Defendants have not made a single payment under the RPPA, and have not made a single payment for ongoing statutory royalties, despite their continued use of the statutory license to stream digital sound recordings to their customers.”