Spotify Singed With $1.6 Billion Lawsuit, Files to Take Company Public in 2018
The streaming giant was just slapped with a jaw-dropping $1.6 billion lawsuit from Wixen Music Publishing. The music publisher watches over artists like Missy Elliott, The Doors, Rage Against The Machine, Tom Petty, Ride, and many more.
Wixen Music Publishing stated in the suit that Spotify didn't acquire the proper rights for tracks by their artists. "We're just asking to be treated fairly. We are not looking for a ridiculous punitive payment. But we estimate that our clients account for somewhere between 1% and 5% of the music these services distribute," states Randall Wixen, CEO of Wixen Music Publishing. "Spotify has more than $3 billion in annual revenue and pays outrageous annual salaries to its executives and millions per month for ultra-luxurious office space in various cities."
Shortly after being hit with this astounding copyright infringement lawsuit, Spotify quietly filed its paperwork for the initial public offering (IPO) with the Securities and Exchange Commission. They are, however, doing things slightly different than usual by "sharing directly on the New York Stock Exchange without raising capital or issuing new shares," states Los Angeles Times. "That unusual move would enable Spotify to go public while saving money on the hefty underwriting fees that companies typically pay to investment banks when they hold an IPO."
Spotify was allegedly aware that it was taking a shortcut when sharing Wixen Music Publishing's catalog to its service; however, it neglected to acquire the proper licenses regardless.