The Mechanical Licensing Collective Brings Legal Action for Unpaid Royalties Against Spotify USA Inc.

Complaint asserts Spotify has underpaid The MLC for royalties due under the compulsory mechanical blanket license.

The Mechanical Licensing Collective (The MLC) announced today that it has filed a legal action against music streaming platform Spotify USA Inc. (Spotify) in the United States District Court for the Southern District of New York. The action seeks recovery of unpaid royalties due under the compulsory mechanical blanket license obtained by Spotify to reproduce and distribute musical works in the United States via its consumer music streaming platform.

The action states that, beginning in March 2024, Spotify asserted that its Premium Individual, Duo and Family subscription streaming plans were now Bundled Subscription Offerings because those plans included access to audiobooks. Applying the rate formula applicable to Bundled Subscription Offerings results in a reduction of the Service Provider Revenue that Spotify reports, which results in an underpayment of royalties.

The MLC believes that Spotify’s position does not comply with applicable law and regulations. The MLC has statutory authority to address Spotify’s noncompliance with its royalty payment obligations. The MLC is taking legal action to enforce these obligations and ensure that Spotify pays all royalties due from its use of songs on Premium plans.

“The MLC was designated by the Register of Copyrights to administer the blanket license and is the only entity with the statutory mandate to collect and distribute blanket license royalties and take legal action to enforce royalty payment obligations,” said The MLC’s CEO Kris Ahrend. “The MLC takes seriously its legal responsibility to take action on behalf of our Members when we believe usage reporting and royalty payments are materially incorrect.”

The MLC seeks corrected usage reporting and associated unpaid royalties for periods dating back to March 2024, along with an order requiring compliance going forward. A copy of the complaint can be found here.

Get Started

MEmbership is always free

Our mission is to support creators like you with full transparency into the performance of your music. Our member portal helps you see which of your songs have earned royalties, which ones are still being matched, and when payments are made. This openness helps you trust the process and know that your songs are being tracked and paid for fairly.

Become A Member

Resources

Resources to help you maximize your earnings

ARTICLES

DURP Informational Webinar

If you’re an independent music distributor, aggregator, or sound recording distributor interested in accessing all the unmatched recordings you’ve

ARTICLES

Data Programs

Data Programs at The MLC The MLC’s data programs support the efforts of dozens of digital media and technology companies around the world to gain insight

FAQs

What are the regulations and where can one find the full text of the rates and terms for Phono 4?

The CRB published a Final Rule in the U.S. Federal Register setting the blanket license mechanical royalty rates for permanent digital downloads.

FAQs

Where can I find answers about The MLC portal?

After you have established a login to the Portal, you will find helpful information in our Knowledge Base.

FAQs

I want to read the regulation myself. Where can I find it?

The regulation outlining this entire process is found in 37 CFR 210.10(c)(5). You can also reference the regulation along with supplementary information as

Explore All Resources

Stay Up
To Date

News & Press Releases

See more news

Press Releases BETA