LyricFind has filed a $1 billion+ lawsuit against Musixmatch over alleged anticompetitive practices. Photo Credit: Musixmatch
Another ugly dispute is unfolding in the lyrics-provider world, where LyricFind is suing Musixmatch for allegedly masterminding an anticompetitive scheme – boxing it out from Spotify in the process.
Canada’s LyricFind submitted the firmly worded action to a California federal court, naming Italy’s Musixmatch as well as its TPG parent as defendants. Spanning a staggering 69 pages, the suit accuses Musixmatch of several Sherman Act violations and of taking various steps “to monopolize the lyric rights licensing market.”
While the lengthy complaint covers more than a few angles, the relevant showdown looks to have kicked off in earnest around March 2024. At that point, LyricFind “was very far along in negotiations with” Spotify to replace Musixmatch on-platform, according to the legal text.
“Spotify had undertaken and largely finalized the technological integration needed to switch from Musixmatch to LyricFind, including a successful internal test using LyricFind lyrics,” the filing party elaborated of the seemingly advanced talks.
Unsurprisingly, the situation didn’t sit right with the “desperate” Musixmatch and TPG, which allegedly responded by looking to “extinguish the competitive threat posed by LyricFind once and for all.”
And this alleged anticompetitive effort arrived in the form of Musixmatch’s “first-of-its-kind” exclusive licensing deal with Warner Chappell, which, having previously licensed both the lyrics providers, allegedly received “a significant premium” under the agreement.
“Musixmatch paid WCM an amount that far exceeds any legitimate commercial goal to become the exclusive provider” at hand, vented LyricFind, which, owing to fractional-licensing implications, faced a massive setback in losing access to Warner Chappell’s catalog.
As LyricFind tells the story, adjacent obstacles quickly followed. “TPG and Musixmatch conspired to force DSPs to remove lyrics supplied by anyone but Musixmatch and quickly caused WCM to terminate its contractual relationship with LyricFind,” the plaintiff spelled out.
Plus, notwithstanding some direct talks between Warner Chappell and Spotify, Musixmatch allegedly maneuvered to block the license (and direct licenses with different DSPs), instead attempting to “force Spotify and other DSPs to sublicense lyric rights and data from Musixmatch.”
In the end, April 2024 saw Spotify cite the Warner Chappell setback when halting “its potential transition to LyricFind” – and then reupping with Musixmatch despite “having already negotiated a significantly better price and service with LyricFind,” per the suit.
Meanwhile, the Warner Chappell fallout also caused iHeartMedia to part ways with LyricFind and to subsequently begin coughing up “over five times” more to Musixmatch for lyrics, according to the complaint.
All told, “[w]ith only Musixmatch left to service the market, prices will rise; choices will be limited; there will be fewer songs with lyrics, translations, sync, and premium data available; and the competitive impetus for innovation” will fall by the wayside, LyricFind claimed.
Hence the many antitrust and monopolization claims against Musixmatch – and the $1 billion in damages that LyricFind is seeking.
“Given LyricFind’s enterprise value before the Exclusive,” the plaintiff wrote, “and the fact that its viability as a business is now at risk, LyricFind estimates that it will have suffered damages exceeding $1 billion after automatic trebling.”
DMN reached out to LyricFind and Musixmatch for comment; the former directed us to an open letter from CEO Darryl Ballantyne, the latter pushed back against the suit’s “meritless accusations.”
“It’s our policy not to discuss legal matters publicly,” Musixmatch told Digital Music News. “We believe these are meritless accusations and choose to concentrate on what matters most: our customers & partners.
“For over 15 years,” the company continued, “Musixmatch has served its customers with the world’s highest-quality lyrics, rights, and data platform. They value our market-leading offerings and innovative new products that embody our obsessive focus on customers and being the best music lyric, rights, and data partner for the industry.”
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