Report: Tune-In Sues Pandora For Breach Of Contract

Radio streaming platform TuneIn is suing Pandora for breach of contract in a deal where the music streaming service failed to meet ad sales goals and guaranteed payments over the first quarter of 2017.

In a lawsuit filed Tuesday (June 20) in California, TuneIn also alleges anticipatory breach, breach of the implied covenant of good faith and fair dealing and negligent misrepresentation, demanding a jury trial, according to Billboard.

TuneIn's complaint against Pandora explains last year the two companies had formed an agreement where Pandora would exclusively sell TuneIn's digital audio advertising inventory for 2017. Under this agreement, Pandora was to pay TuneIn a guaranteed quarterly revenue so long as TuneIn supplied a minimum number of audio impressions each month. At the crux of the deal was Pandora's "purportedly revolutionary and newly-launched advertising platform" Harmonic Audio Network, which Pandora had touted as a game-changing service to improve placements to better align with brand values with improve listener engagement.

TuneIn alleges Pandora "did not invest the resources and effort necessary to make the Network a successful sales platform" and points to its "dismal sales" as proof. Over the first three months of 2017, Pandora sold against just 13.9 percent of TuneIn's forecasted 881,000,000 impressions. Historically, TuneIn states it sold 60-70 percent of its advertising inventory by leveraging several third parties. In this exclusive agreement with Pandora, TuneIn had hoped to increase those figures to 100 percent.

After Pandora failed to adequately sell TuneIn's advertisement inventory over the first quarter of 2017, with a multi-million dollar guaranteed payment due, the suit alleges the company fabricated a breach of the agreement by TuneIn that claimed TuneIn failed to provide its inventory forecast in a "reasonably acceptable format," as their deal demanded. This, TuneIn calls "a thinly-veiled attempt to avoid its payment obligations in light of its poor sales results."

TuneIn provides live streams to more than 60 million users worldwide, according to the complaint, with producing and selling advertisement inventory as its primary method of monetization.

TuneIn is seeking a money judgment in the amount of damages to be proven at trial and an award of reasonable costs and legal fees.