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Image credit: Flickr/Bjrn Olsson

Spotify is on the hook for $150 million in class-action suit

Two artists claim that Spotify knowingly avoids paying royalties to some musicians.

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Flickr/Bjrn Olsson

A class-action lawsuit filed this week claims that Spotify knowingly and willingly distributes songs without obtaining the proper, mechanical licenses, Billboard reports. The suit, filed by the band Camper Van Beethoven and Cracker frontman David Lowery on December 28th, seeks $150 million in damages. The artists launched a class-action suit because Spotify's actions affect more than 100 people, according to the complaint.

Spotify recently penned a blog post that lays out the complicated music-licensing landscape, noting that it's paid out more than $3 billion in royalties since launching. It has a store of money set aside to pay outstanding fees, too -- Billboard says this reserve fund contains between $17 million and $25 million.

"When we confirm the rightsholder, we pay those royalties as soon as possible," Spotify writes in its blog post. "To put this all in context, the royalties we have set aside amount to a fraction of one percent of all the royalties we have paid."

Spotify is working to settle a similar suit with the National Music Publishers Association.

[Image credit: Flickr/Björn Olsson]

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