The music streaming service Spotify has been hit with a $1.6bn (£1.2m) lawsuit for breach of copyright, in a test case that could have wide-ranging implications for the music industry.
Wixen Music, a leading US music publisher, has accused the Swedish-based firm of using artists’ music “without a licence and without compensation”. The company handles copyright management and royalty compliance for artists including Tom Petty, The Doors, Janis Joplin, Neil Young and Missy Elliot.
In all more than 10,000 songs are listed in the lawsuit, with Wixen seeking damages of $150,000 per song, the maximum awarded under the US Copyright Act.
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“The lawsuit is just the latest copyright headache for the music-streaming service,” says CNN Money. In May, Spotify settled a class action lawsuit with a group of songwriters for $43m (£32m) and is contesting three other suits in the US over a failure to pay royalties to publishers and songwriters.
In recent years, Spotify has struck deals with major record labels, resolving potential copyright liabilities. These deals “have been an important new source of revenue for the music industry, which has contracted sharply over the last 15 years”, says the BBC.
However, the issue continues to trouble the firm, which has an estimated 60 million subscribers worldwide and is gearing up to list shares on the stock market later this year.
Despite being valued at $19bn (£14bn), Spotify has struggled to make a profit since it launched a decade ago. If the court finds in Wixen’s favour, the company could face further lawsuits around the world.
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