Just ahead of an IPO that could value it at $13 billion, Spotify has been railing against consistent legal onslaughts from industry members, the latest being two lawsuits accusing the service of "willful infringement on a staggering scale."
Spotify had already made the headlines after being hit by the class action lawsuit by the band Camper Van Beethoven and Cracker frontman David Lowery. At the same time, it was also working to settle a similar suit with the National Music Publishers Association. Having settled NMPA lawsuit for $43.5 million this May, the service was all set to move forward with their IPO before another hiccup came along. A clause in the settlement allowed any publishers wanting out of the settlement time until September – an option that Gaudio and Bluewater decided to take on.
Bob Gaudio, a songwriter and founding member of the group Frankie Valli and The Four Seasons alleges that famous hits including "Can't Take My Eyes Off You" and "Rag Doll" are being distributed through Spotify without being fully licensed.
The second lawsuit has been filed by Bluewater Music Services Corporation, an entity that administers the publishing rights of dozens of prominent country songwriters whose works include Player's "Baby Come Back," Miranda Lambert's "White Liar" and Guns 'N Roses' "Yesterdays."
Collectively, both these lawsuits encompass thousands of songs. The Bluewater suit stated that according to the previous settlement, Spotify was only paying $4 per song, a shamefully low amount for a crime as severe as willful copyright infringement. According to the suit, any amount lower than $150,000 per song “would encourage infringement, amount to a slap on the wrist, and reward a multibillion dollar company, about to go public, that rules the streaming market through a pattern of willful infringement on a staggering scale."
Spotify has undoubtedly been making big efforts on its part for ensuring that the kind of online streaming they’re enabling is completely legal. It has arranged deals with large music labels and purchased blanket licenses from the likes of ASCAP and BMI so that it may publicly perform music.
Spotify earlier this year acquired Media chain, which had developed a Bitcoin-style secure database to manage ownership information for Internet media companies.
While the company has been trying to erase the gray areas within the online streaming industry, considering the vast scope of the field, it’s safe to say that it’s a daunting task. Regardless, people listen to music differently now, and expecting everyone to buy their music from stores (online or brick) is impractical. Online streaming is a trend that’s here to stay, and the issues surrounding it will only be resolved with constructive efforts from all stakeholders.