SoundExchange Wins $9.7 Million Slacker Suit

• On Thursday, Oct. 13, the United States District Court for the Central District of California entered a $9.7 million judgment against Slacker, Inc., and its parent company LiveOne, Inc. in a lawsuit filed by SoundExchange in an effort to collect unpaid royalties owed to performers and rights owners, under the U.S. government’s Section 114 sound recording license. The court also permanently barred Slacker and LiveOne from using the statutory license going forward.

The statutory license allows non-interactive digital music streaming services to play music in return for monthly payments at the statutory rate determined by the Copyright Royalty Board. SoundExchange collects statutory payments from more than 3,600 services and distributes monthly royalties to copyright owners, featured recording artists, and non-featured musicians and vocalists.

Commenting on the court’s ruling in their favor, SoundExchange Pres. & CEO Michael Huppe said, “SoundExchange takes our role in defending fair compensation for creators seriously. Despite a prior agreement, multiple promises, and repeated negotiations, Slacker and LiveOne failed to pay properly for the music — on which the companies built their business model. It is regrettable that this step became necessary, but we will not back down when it comes to protecting creators and ensuring they are well-represented and properly paid under the law. We are grateful for the court’s recognition of the value proposition and this judgment in our favor.”