The Mechanical Licensing Collective (MLC) has filed an opposition to Spotify's motion to dismiss their unpaid-royalties lawsuit, focusing on the streaming giant's controversial bundling practices.

The dispute centers on Spotify's reclassification of its subscription services. By categorizing nearly all Individual subscriptions as "bundles" that include audiobooks, Spotify reportedly saves approximately $150 million annually in domestic compositional royalties. The MLC argues this has a devastating financial impact on music creators.

Key points of contention:

• The MLC claims the audiobook offerings have only "token" value and don't qualify as legitimate bundles under Section 115
• Spotify maintains that audiobooks represent a distinct product tier eligible for bundling classification
• The timing of audiobooks' integration (November 2023) and accessibility of the audiobook-only tier are disputed factors

In its 30-page opposition filing, the MLC argues:

• The case deserves full consideration beyond a dismissal motion
• The complaint meets the Second Circuit's plausibility standard
• All factual allegations should be accepted as true at this stage

The outcome of this case could have significant implications for how streaming services structure their subscription offerings and calculate royalty payments to music creators. The industry awaits the court's decision on whether this high-stakes lawsuit will proceed to trial.

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