WMP Files Class Action Lawsuit Against Universal Music Group for Withholding Shares of Spotify Stock from Artists

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On January 4, 2023, WMP filed a class action lawsuit in New York Federal Court to recover hundreds of millions of dollars for artists allegedly victimized by Universal’s withholding of shares of Spotify from artists.    

The suit alleges that Universal breached its contracts with artists and deprived them of the royalties they are contractually owed.  Specifically, Universal is alleged to be withholding hundreds of millions of dollars in royalties from artists through a previously undisclosed arrangement whereby Universal licensed artists’ recordings to the Spotify music streaming service in exchange for Spotify stock and lower royalty payments.  Under this arrangement, WMP’s suit alleges that instead of paying artists their full royalty payments, Universal made smaller payments and held onto Spotify stock that contractually belongs to Universal’s artists.

The suit also alleges that Universal concealed from artists that it acquired Spotify stock and that royalty payments were depressed as a result.  Over time, the value of the Spotify stock that Universal improperly withheld from artists is alleged to have ballooned to hundreds of millions of dollars.

To read the Class Action Complaint, click here.

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