Sony Music defends Spotify amid lawsuits

Spotify hasn't been the most popular music platform among recording artists. Taylor Swift infamously slammed the way it treats musicians, and the company has been hit by a steady stream of lawsuits from agencies and self-backed artists over their payout policies. The latest lawsuit has come from 19 Entertainment, an American Idol-affiliated agency that manages talent ranging from Kelly Clarkson to Carrie Underwood. 

Sony claims that its actions — taking Spotify equity to the tune of 6 percent and keeping some of the profits away from artists — are all within its contractual rights. In their own words their contract allows them to act on their "own interests in a way that may incidentally lessen the other party's anticipated fruits from the contract." They added that their company has no obligation "to structure its affairs in whatever way yields the greatest royalties for 19." 

19 Entertainment's complaint claims that Sony has manipulated their relationship with Spotify to unethically withhold payouts from artists, and have argued that the company and other major record labels not only "have significant power to exert control over Spotify… but [also] wrongfully and in bad faith divert money from royalties that must be shared to other forms of revenue that they can keep for themselves."

The plaintiffs are pushing to amend the lawsuit to include this breach of good faith and fair dealing.

Regardless of where you stand as a company it's always good idea to get in touch with a qualified business attorney as soon as possible. A good lawyer can make sure your rights as a business owner are protected, and help you better navigate through the nuances of running a business to avoid legal recourse from others.

Categorised in: Entertainment Law

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