SoundExchange Sues Sonos, NMPA and X Pause Lawsuit, and Indie Musician Sues AI Music Startups
How The Music Business Works - Issue #16
June 19, 2025
Welcome back to How The Music Business Works!
This week’s roundup highlights growing legal pressure across the music and tech industries.
Disputes over unpaid royalties, copyright infringement, and AI training practices are making headlines, with major players, including platforms, labels, and independent artists, taking action. From streaming services to AI startups and social media platforms, the battle over music rights continues to intensify.
SoundExchange has filed a lawsuit against Sonos and Napster, alleging $3.3 million in unpaid royalties and fees tied to Sonos Radio, the non-interactive streaming service powered by Napster from 2020 to 2023. The issue began after Napster’s 2022 acquisition by blockchain firms Hivemind and Algorand, which led to missed reporting and payments. While Sonos blames Napster, SoundExchange argues that Sonos, as the service operator, is ultimately responsible for compliance with its license. The dispute covers unpaid royalties from 2022–2023.
Music Publishers and X Begin ‘Good Faith’ Negotiations in Copyright Lawsuit
The National Music Publishers’ Association (NMPA) and X Corp have paused their copyright lawsuit to explore a settlement, following a joint request for a 90-day stay granted by a Tennessee court. The publishers sued X in 2023, alleging widespread unlicensed use of music and seeking over $250 million in damages for around 1,700 works. According to the NMPA, the pause is intended to allow discussion of fair compensation for past infringements and a potential path toward proper licensing moving forward. If the talks are successful, both sides will file for dismissal. If not, they may return to court or request more time to continue negotiations.
Independent artist Anthony Justice has filed a class action lawsuit against AI music startups Suno and Udio, accusing them of illegally using indie artists’ music without permission to train their AI models. Justice argues that while major labels are already suing both companies, independent creators have been most affected and remain unrepresented. The suit challenges the companies’ fair use defense and cites a recent U.S. Copyright Office report warning against unauthorized AI training on creative works. Justice seeks to represent thousands of U.S.-based indie artists whose music has been available online since 2021.
US Supreme Court Rejects Appeal in Ed Sheeran Copyright Case Over ‘Thinking Out Loud’
The U.S. Supreme Court has declined to hear an appeal from Structured Asset Sales (SAS) in its long-running copyright lawsuit against Ed Sheeran, officially ending the case. SAS, which owns a share of Marvin Gaye co-writer Ed Townsend’s interest in Let’s Get It On, alleged that Sheeran’s Thinking Out Loud copied the 1973 classic. Lower courts had consistently ruled in Sheeran’s favor, and the Second Circuit upheld that decision in 2024. After being denied a rehearing, SAS appealed to the Supreme Court, which rejected the request on June 16. Sheeran’s legal team had argued that overturning the ruling could encourage speculative copyright claims.
Labels Push Back Against Government Support for Cox Communications in Copyright Infringement Battle
Major record labels have filed a rebuttal at the U.S. Supreme Court after the Justice Department sided with Cox Communications in a long-running copyright lawsuit. The labels argue Cox knowingly allowed repeat copyright infringement by subscribers and prioritized profits over enforcement, despite receiving hundreds of infringement notices. A jury originally awarded the labels $1 billion, but a federal appeals court later overturned the vicarious liability ruling. Now, both Cox and the labels are seeking Supreme Court review, with the labels urging the Court to reinstate the full liability ruling. The case is part of a broader legal campaign by the music industry against ISPs for failing to act on piracy.