The Mechanical Licensing Collective (MLC) has filed an opposition to Spotify's motion to dismiss their unpaid-royalties lawsuit, focusing on the streaming giant's controversial bundling practices.

The dispute centers on Spotify's reclassification of its subscription services. By categorizing nearly all existing Individual subscriptions as "bundles" that include both music and audiobooks, Spotify is reportedly saving approximately $150 million annually in domestic compositional royalties.

The MLC argues that these packages don't qualify as legitimate bundles under Section 115 because:

• Audiobooks have only "token" value to subscribers
• The audiobook-only tier is difficult to locate
• The audiobook tier isn't truly distinct from the music package

Spotify counters that:

• Audiobooks represent significant value
• The timing of audiobook integration (November 2023) preceded bundling reclassifications (March 2024)
• The audiobook-only tier constitutes a distinct product offering

In its 30-page opposition filing, the MLC maintains that dismissal would be premature, stating that the complaint meets the plausibility standard required at this stage of litigation. They argue that all factual allegations should be accepted as true and reasonable inferences drawn in the MLC's favor.

The outcome of this case could have significant implications for music creators, who the MLC describes as "the lifeblood of Spotify's multibillion-dollar business." The organization argues that the current bundling practice has a "devastating financial impact" on these creators, highlighting the growing tension between streaming platforms and rights holders over fair compensation.

Related Articles

Previous Articles