Indie label calls Spotify countersuit ‘procedurally defective, legally deficient’ in motion to dismiss

Florida-based independent music company Sosa Entertainment LLC has asked a federal Judge to dismiss a countersuit filed by Spotify last month, calling the streaming company’s action “procedurally defective” and “legally deficient”.

Sosa is owned by Jake P. Noch, who also owns royalty collection firm Pro Music Rights LLC (PMR).

Spotify countersued Sosa last month after being hit with a lawsuit by the Florid-based firm back in November 2019, seeking “over $1bn in damages” from the streaming company – claiming, amongst other things, that Spotify has not paid Sosa full royalties associated with over 550 million streams.

In Spotify’s countersuit, filed in a Florida court on May 18, and which you can read in full here, SPOT claimed that “Noch directed third parties to create millions of fake Spotify accounts, and deployed these fake accounts to artificially stream his and Sosa’s content up to hundreds of thousands of times daily, and upwards of hundreds of millions of times in total.”

Spotify’s countersuit also claimed that its fraud-monitoring team found “unmistakable signs that the streams of Noch and Sosa’s content had been artificially inflated”.

The suit adds: “Following discovery of the fraud, Spotify acted to root out the offending content by removing Noch and Sosa’s content and preventing its delivery onto Spotify’s platform.

“Spotify expended considerable time, resources, and manpower to protect its users and safeguard its platform from Noch and Sosa’s deceptive tactics.”

According to the motion fled by Sosa earlier this week (June 15), obtained by MBW and which you can see in full here, Spotify’s allegations regarding the fake accounts are “procedurally defective, legally deficient, short on specifics, and replete with assumptions and guesswork”.

Additionally, Spotify’s counterclaims and third-party complaint directed at Jake Noch, according to Sosa, are “defective” because “they attribute conduct collectively to ‘Noch and Sosa,’ with virtually no specific allegations about either Sosa or Noch, individually”.

“In doing so,” argues Sosa, “Spotify does not properly connect any one defendant to any particular conduct”.

Citing an “Eleventh Circuit and Middle District of Florida precedent,” the filing claims that Spotify collectively countersuing Noch and Sosa “constitutes impermissible shotgun, group pleading”.

According to that precedent, argues Sosa, “conclusory group pleading” is prohibited and “requires a plausible, individualized basis for implicating each defendant in an alleged conspiracy”.

Adds the filing: “Because the Counterclaims and the third-party complaint lump Noch and Sosa together, and do not inform either of the nature of each’s respective alleged role, including in any fraud, the claims against both Noch and Sosa should be dismissed.”

Meanwhile, in March, Pro Music Rights LLC (PMR) filed an antitrust lawsuit against what it says is “the entire music industry”, suggesting that the defendants “have entered into an illegal agreement, combination and/or conspiracy to shut PMR out of the market and to fix prices at infracompetitive levels”.

Named in the suit are Apple, Amazon, Google, Youtube, Spotify, Digital Media Association, National Religious Broadcasters Music License Committee, Radio Music License Committee, Inc., The National Association Of American Wineries, Television Music License Committee, Llc, 7digital, Deezer, iHeartmedia, Connoisseur Media, Pandora, Rhapsody International and SoundCloud.

PMR added that Apple, Spotify et al  “have choreographed a refusal, and continuous refusal”, to work with the company.

That suit followed a bundle of 10 copyright lawsuits filed in December 2019 by PMR, against music streaming services, in the U.S. District Court for the Southern District of New York.

PMR claims to have a 7.4% market share based on musical works, with the rights to license about 2 million works from artists including A$AP Rocky, Wiz Khalifa, Pharrell, Young Jeezy, Juelz Santana, Lil Yachty, Soulja Boy, Nipsey Hussle, 2 Chainz, Migos, Gucci Mane and Fall Out Boy, among others.Music Business Worldwide

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