The heat on Spotify for alleged underpayment of song royalties escalated late Thursday as the Nashville-based Mechanical Licensing Collective filed legal action against the streaming service in the United States District Court for the Southern District of New York.
The Tennessean reports the lawsuit comes on the heels of stern warnings sent to Spotify from multiple songwriting agencies including the Nashville Songwriters Association International, the National Music Publishers Association and the Association of Independent Music Publishers.
In February, the MLC brought a lawsuit against music streaming service Pandora for underpayment of royalties.
The Mechanical Licensing Collective was formed after 2018's Music Modernization Act and is responsible for administering the blanket compulsory license for the use of musical works by digital music services, meaning that it collects royalties owed to songwriters for songs played on streaming services.
In a statement, the MLC said 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."
In March of 2024, Spotify "bundled" its music streaming plan with audiobooks, which altered the rate in which royalties would be paid. Currently, Spotify subscribers cannot access a music-only subscription, although Spotify says that is in the works, but cannot say when that will become active.
The MLC asserts that Spotify's actions are unlawful and has taken this legal action to attempt to ensure that Spotify pays all royalties due from its use of songs on premium plans.
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