Court finds Slacker, LiveOne owe Soundexchange $9.7M in unpaid royalties

Last week, a California court ruled that Slacker and parent company LiveOne owed $9.7 million in unpaid royalties.

The lawsuit was filed by SoundExchange, the performing rights organization charged with collecting non-interactive streaming royalties.

The court also permanently barred Slacker and LiveOne from using the U.S. Section 114 sound recording statutory license going forward. That license allows non-interactive digital music streaming services to play music in return for monthly payments at a rate determined by the Copyright Royalty Board. 

The ruling likely means the end of Slacker and could doom LiveOne’s other music-streaming initiatives. As of Tuesday morning, Slacker was not loading, but LiveOne was still offering ad-supported music streams.

SoundExchange said that Slacker and LiveOne stopped making payments in 2017.

“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,” stated Michael Huppe, President and CEO of SoundExchange. “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.”

Bruce Houghton is Founder and Editor of Hypebot and MusicThinkTank and serves as a Senior Advisor to Bandsintown which acquired both publications in 2019. He is the Founder and President of the Skyline Artists Agency and a professor for the Berklee College Of Music.