Spotify has faced its fair share of lawsuits in the past and is no stranger to them when it offers unlicensed songs, but through this method, things can get ugly and costly very quick.
A new report from Hollywood Reporter says that Wixen Musix Publishing, which manages song composition rights for artists ranging from Neil Young to Zach de la Rocha, have filed a lawsuit against Spotify for copyright damages of at least $1.6 billion. Wixen claims that Spotify is using tens of thousands of songs without proper licenses in place and the compensation to match. The plaintiff had already rejected a proposal settlement of $43 million in another case in May, so this shouldn’t really be surprising.
While this lawsuit was filed against Spotify, the streaming service has questioned whether Wixen actually has permission from its artists. The label may be allowed to negotiate on behalf of the musicians, but that doesn’t mean it’s allowed to sue on their behalf. Spotify could also use a similar argument it used in another case where the company said that streaming doesn’t imply distribution or reproduction rights.
If this lawsuit is won by Wixen, it could prove to be very costly and damaging to Spotify. The company is still losing money after years of operation. The company’s entire revenue in the first half o 2017 totaled $2.2 billion. The company would then become neck deep in the red and would most likely have to raise subscription fees if it hoped to stay afloat. Spotify as you’d expect will fight this lawsuit as hard as it can, or at least settle for a much smaller settlement that Wixen would be willing to accept.
