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More Fancy Stuff From Spotify Against David Lowery

February 17, 2016

I’ve been reading over Spotify’s papers filed in response to David Lowery’s lawsuit against the company and noticed a couple of things.  One that is hiding in plain sight, so to speak, the other that is quite a gloss on reality.

The Case of the Purloined Stream

Recall that Spotify has said several times that they want to pay “every penny” they owe songwriters, they just need to know who to pay.  (Leave aside for the moment that this is more “Fancy” Grade bullshit because they actually don’t need to know who to pay in order to rely on the compulsory license–they just need to send the U.S. Copyright Office a notice of their intention to rely on the compulsory under the plain language of  17 U.S.C. Sec. 115(b)(1)–“If the registration or other public records of the Copyright Office do not identify the copyright owner and include an address at which notice can be served, it shall be sufficient to file the notice of intention in the Copyright Office”.  While this may not be popular at the Copyright Office, I’m sure some accommodation could be worked out.)

Recall also that Spotify said in the company’s blog that:

[w]hen one of our listeners in the US streams a track for which the rightsholder is not immediately clear, we set aside the royalties we owe until we are able to confirm the identity of the rightsholder. When we confirm the rightsholder, we pay those royalties as soon as possible.

So why is it that the lawyers for Spotify did not inform Judge Beverly Reid O’Connell of their client’s action in the responsive papers?  That begs the question, what is different about a blog post compared to a court filing?

Perhaps it is because the lawyers filing the court papers have an obligation as officers of the court not to make a false or misleading statement to the Court?  Perhaps it is because the statement in Spotify’s blog post is not, strictly speaking….whatchamacallit…I guess you’d have to say “true”?

When Is A Job Not A Job?

Spotify’s lawyers are–quite understandably–throwing the Fancy against the wall to see how they can knock this suit out of the box in California where Spotify applied to do business as a foreign corporation:

spotify sec state ca

One way they can do this is to prove that Spotify has insufficient contacts with the judicial district where the suit is filed to permit the Court to assert jurisdiction over Spotify (sometimes called an “inconvenient forum”), a common delaying tactic.  Even so, it is becoming clear that Spotify wants to fight the case in New York.  Here’s an example of that argumentation:

Plaintiff’s complaint points to only one form of contact that conceivably reflects Spotify’s direction of contacts towards California in particular: Spotify’s two California offices. But those offices are irrelevant to specific jurisdiction, because they are not related to this lawsuit….Spotify’s two small offices in California do not fit the bill. They employ a total of approximately 50-60 employees. This is far less than the 450-500 employees located in New York, which is the hub of the company’s United States operations. All but eight of these employees work in roles unrelated to the content part of Spotify’s business….The majority of California employees work in advertising sales and of the few California employees who perform work related to the content side of Spotify’s business, not a single one is involved with music composition licensing—the subject matter of this litigation.

High level, Spotify argues that if the defendant in a lawsuit has not originated contact with the particular judicial district by actions related to subject matter of the particular suit, then the defendant may be able to have the case removed to a judicial district where the plaintiff has more relevant business contacts, New York in Spotify’s case.  Spotify is arguing that all the jobs that relate to Spotify’s publishing business are in New York–aside from the fact that Los Angeles is a major music industry hub and aside from the fact that the parent corporation of Spotify’s clearance agents the Harry Fox Agency has extensive offices in Los Angeles.

So remember–Spotify’s lawyers tell the Court that “not a single one is involved with music composition licensing.”

Imagine my surprise to find this job posting for a Los Angeles-based Director of Publisher and Songwriter Relations, North America on the Spotify website:

spot pub job

Particularly because the job description provides for the Director of Publisher and Songwriter Relations, North America to work on “reporting…finance and legal.”  A director level job often reports to a senior director or VP and has various managers reporting to the director.

Sounds like a pretty “Fancy” job.

So perhaps what the lawyers meant to say was “not a single one is involved with music composition licensing”–yet.

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