Spotify and Wixen have mutually agreed to dismiss the $1.6 billion copyright infringement lawsuit filed by the latter back in 2017. The publishing company argued in the dispute that Spotify was illegally using tens of thousands of songs from artists it represented, such as Missy Elliot, Neil Young, and Steely Dan – since the streaming company had not obtained “a direct or compulsory mechanical license” from the songwriters to use their song on the platform.
Aside from the complaint that Spotify was neglecting to send paper notifications – engaging in copyright infringement, Wixen also claimed that the music streaming giant was about 21 percent of the time not paying songwriter royalties. Wixen demanded statutory damages of $150,000 for each song, which amounts to a total of $1.6 billion.
In a statement by Wixen and Spotify, amicably agreeing to dismiss the lawsuit, the parties said: “the conclusion of that litigation is a part of a broader business partnership between the parties.” Having established a sustainable “mutually-advantageous relationship,” the legal claims asserted by Wixen Music Publishing has been fairly and reasonably resolved.
Court had given the entities until December 21st to make peace
Due to an “ongoing settlement discussions” between the two entities, a judge granted the parties an extension to respond to the filing, according to a filing from October 16, 2018, reports TechCrunch. They had until December 21st to respond, and would not be granted any further continuances.
Spotify has in more recent months been working hard to address its needs and the claims by those holding music rights. The music streaming company was directed to be more efficient in collecting information about composition owners to resolve the issues of nonpayment of royalties in the future.
The Stockholm-based company is making efforts to follow up on that. Earlier this year, it launched a new songwriter credit feature; a service that easily tracks composition owners. Spotify last month launched an analytics service which music publishers can use in tracking the streaming stats of their artists.
There is no information on the financial terms of the settlement. However, the $1.6 billion was not awarded. According to TechCrunch, no disclosure has been filed by Spotify to shareholders with the SEC.
The Music Modernization Act (MMA), which overhauls streaming licensing regulations, would resolve all complexities in this particular issue in the future. A section of the MMA does not support the bulk notice of intent process for songwriters but would require physical delivery of paper notice – this backs the Wixen lawsuit. However, the new MMA laws will only apply to royalty disputes that occur after the 1st of January 2018, and that exempts the Wixen dispute.