The Mechanical Licensing Collective (MLC) and Spotify are engaged in an escalating legal battle over mechanical royalty payments, now complicated by a discovery dispute.

Key Points of Conflict:

• Spotify reduced U.S. mechanical royalty payments after reclassifying its main subscription packages as "bundles" following audiobook integration
• The MLC disputes this classification, arguing the packages don't qualify as true bundles
• Millions in allegedly unpaid royalties are at stake

Discovery Dispute Details:

The MLC seeks documents regarding:

• Decision-making process behind audiobook and music-only plans
• Revenue, subscriber numbers, and profit data for audiobook tier
• Technical architecture of the platforms

Spotify's Position:

• Agreed to 53 of 60+ document requests
• Claims requests are "extremely broad" and "invasive"
• Seeks internal communications between MLC, music publishers, and NMPA
• Requesting clarification on MLC's bundle classification criteria

Status:

• Both parties met via Zoom on September 18th
• Multiple written correspondences failed to reach compromise
• Court intervention has been requested
• Settlement appears unlikely in the near term

The case centers on Spotify's audiobook-inclusive plan, which costs $2 less than the standard subscription but includes 15 hours of audiobooks instead of ad-free music, potentially affecting mechanical royalty calculations significantly.

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