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SoundCloud is being sued by a UK licensing company for not paying royalties

SoundCloud says the lawsuit is 'entirely devoid of merit'

Performing Rights Society for Music (PRS), a group that represents musicians and publishers in the UK, is suing SoundCloud for failing to obtain the proper license to host PRS members' music on its platform. PRS announced this morning that the decision to take legal action came after "five years of unsuccessful negotiations."

License to stream

The group, which licenses music to organizations and distributes the resulting royalties to artists, insists that SoundCloud needs a "PRS for Music license" to legally stream the music of members in the UK. Without the license, SoundCloud is not properly compensating PRS members for their work, PRS claims. PRS said in a statement that it sent SoundCloud a list of 4,500 songs that infringe on the copyright held by its members, and SoundCloud removed just 250 of them. PRS says SoundCloud can either obtain a license to pay for the use of these songs, or remove them entirely.

It's not clear if PRS is referring to songs uploaded by the artists themselves, or unauthorized samples and uploads. If it's the former, it's possible PRS and its members have conflicting opinions about what should be available on SoundCloud. PRS claims it's trying to "establish a principle" with the lawsuit:

Our aim is always to license services when they use our members’ music. It has been a difficult decision to begin legal action against SoundCloud but one we firmly believe is in the best, long-term interests of our membership. This is because it is important we establish the principle that a licence [sic] is required when services make available music to users. We have asked SoundCloud numerous times to recognise [sic] their responsibilities to take a licence [sic] to stop the infringement of our members’ copyrights but so far our requests have not been met. Therefore we now have no choice but to pursue the issue through the courts.

SoundCloud has been having a rough year so far. Sony began pulling its artists from the service in May after the two companies failed to reach a payment agreement. And SoundCloud has recently been getting more aggressive about copyright infringement, but that's causing a lot of DJs (who are some of SoundCloud's most prolific users) to jump ship.

A SoundCloud spokesperson told The Verge that SoundCloud and PRS were still in the middle of negotiations when PRS decided to sue:

It is regrettable that PRS appears to be following this course of action in the midst of an active commercial negotiation with SoundCloud. We believe this approach does not serve the best interests of any of the parties involved, in particular the members of the PRS, many of whom are active users of our platform and who rely on it to share their work and communicate with their fanbase.

Updated August 27th, 11:25AM ET: Updated to add SoundCloud's comment.