Spotify is one of the larger streaming music services out there. They are also one of the more popular. Being that they have both free and premium services but they also have a service for students that get them Spotify Premium for a smaller price. Spotify does pay royalties to musicians and artists, but as we know, the music licensing industry is not cut and dry as it should be. It's pretty complex, and now there's word that Spotify is being slammed with a lawsuit that is demanding $150 million in damages. According to Billboard, the suit has been filed by the band Camper Van Beethoven and Cracker Frontman David Lowery. They are seeking $150 million in damages. Now they have launched a class action lawsuit because the actions here affect over 100 people.
Just last week, the music streaming service wrote a blog post talking about the complicated music-licensing landscape. In that post, Spotify mentioned that they have paid over $3 billion in royalties since they've launched, in October of 2008. Spotify also has money set aside for paying outstanding fees as well. Reports claim that the reserve is around $17 million to $25 million.
According to this complaint, penalties for playing these songs on Spotify's network without paying royalties, allow for judgements between $750 and $300,000 for each infringed work. And up to $150,000 per song that was infringed. And there are a number of songs that are said to be infringed here, hence the reason why this is a class action lawsuit, affecting at least 100 users (by definition).
Currently, there is no word from Spotify on this lawsuit, and there likely won't be. As lawyers usually tell their clients not to comment on lawsuits in any form as they can be used against them. The suit was filed in California on December 28th. We likely won't hear more for a few months as these things do take a bit of time. As soon as we learn more about this lawsuit, we'll be sure to pass the information along to you. But right now, it's not looking too good for Spotify, who so far has yet to turn a profit.