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Tidal facing $5 million class action lawsuit over alleged unpaid royalties

Spotify is busy trying to bring a halt to the $150 million class action lawsuit it is facing over alleged unpaid royalties, and now it seems it will have some companionship, as its competitor Tidal is finding itself in a similar legal situation.

Tidal, which has always aimed to position itself as a more artist-friendly alternative to other streaming services, including Spotify and Apple Music, is now facing its own $5 million class-action lawsuit over alleged unpaid royalties, Complex reports. This suit comes from Yesh Music, LLC and John Emanuele​ from the band the American Dollar, and claims that 116 of the band’s songs were streamed on Tidal without the company acquiring the proper licenses.

Related: Spotify looking to halt $150 million class-action lawsuit over royalties

While Spotify was slow to respond to the suit that was filed against it by musician David Lowery, Tidal reacted to this suit immediately. In addition to pulling all of the music in question from its site, the streaming service responded with a statement of its own, claiming that the service “is up to date on all royalties for the rights to the music stated in Yesh Music, LLC and John Emanuele’s claim and they are misinformed as to who, if anyone, owes royalty payments to them.”

“As Yesh Music, LLC admits in their claim,” Tidal’s statement goes on, “Tidal has the rights to the Master Recordings through its distributor Tunecore and have paid Tunecore in full for such exploitations. Their dispute appears to be over the mechanical licenses, which we are also up to date on payments via Harry Fox Agency our administrator of mechanical royalties.”

The statement then goes on to further question the validity of the claim, stating that the entire catalog was streamed less than 13,000 times, and that this is the first the company has heard of such a claim. “They especially should not be naming S Carter Enterprises, LLC, which has nothing to do with Tidal,” the statement reads.

Related: Samsung eyeballs Tidal for acquisition along with several other streaming services

Meanwhile, back in Spotify’s courtroom, in its attempt to dismantle the $150 million suit from David Lowery, Spotify pointed to specific instances in order to show the claim lacks validity as a class action, but generally stayed away from explicitly refuting all­ of his claims. Tidal, on the other hand, seems confident that the suit from Yesh Music isn’t anything to worry about.

If nothing else, assuming Tidal ends up being on the right side of the law, this is a good chance for the company to prove that it does indeed pay the royalties it claims it does.