On May 16, the Mechanical Licensing Collective (MLC), a non-profit entity responsible for administering blanket licenses enacted by the Music Modernization Act (MMA), filed a lawsuit in the Southern District of New York alleging that Swedish streaming media company Spotify has failed to meet its royalty obligations for MMA blanket licenses. The MLC alleges that Spotify’s recent decision to reclassify its Premium subscription service as a bundled subscription offering, leading the streaming company to reduce service revenue reported to the MLC by nearly 50%, is based on a faulty rationale that violates Spotify’s revenue reporting responsibilities for the service.
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