The Mechanical Licensing Collective Sues Spotify Over Audiobook Bundling Royalty Dispute
The Mechanical Licensing Collective (MLC) has filed a lawsuit against Spotify over unpaid royalties related to bundled subscription offerings. The dispute centers on Spotify's March 2024 reclassification of its Premium Individual, Duo, and Family plans as bundled subscriptions after including audiobook access.
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The lawsuit, filed in the United States District Court for the Southern District of New York, alleges that Spotify's bundling strategy reduces reported service provider revenue, resulting in lower royalty payments. The MLC contends these bundled plans violate applicable laws and regulations.
As the officially designated administrator of the blanket license by the Register of Copyrights, the MLC has statutory authority to enforce royalty payment obligations. CEO Kris Ahrend emphasized the organization's legal responsibility to act when usage reporting and royalty payments are materially incorrect.
The MLC seeks:
- Corrected usage reporting from March 2024 onwards
- Recovery of unpaid royalties
- Order requiring future compliance
Since January 2021, the MLC has distributed over $2 billion in royalties to songwriters and music publishers at no cost to rights holders.
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Case Number: 1:24-cv-03809
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