Ferrick v. Spotify USA Inc.
www.SpotifyPublishingSettlement.com

Frequently Asked Questions

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1. WHY DID I RECEIVE THE NOTICE?

You are receiving the notice because you may be a member of a Settlement Class consisting of the following:

all persons or entities who own copyrights in musical compositions (a) for which a certificate of registration has been issued or applied for on or before June 29, 2017; and (b) that was made available by Spotify for interactive streaming and/or limited downloads during the class period (December 28, 2012 through June 29, 2017) without a license, except for (i) Spotify and its affiliates, employees, and counsel; (ii) federal, state, and local governmental entities; (iii) the Court; (iv) persons and entities who, in 2016, executed a Participating Publisher Pending and Unmatched Usage Agreement in connection with the Pending and Unmatched Usage Agreement, dated as of March 17, 2016, between Spotify and the National Music Publishers’ Association, or any other person or entity who has agreed not to bring a claim against Spotify in this Action; and (v) any person or entity who has already provided Spotify with a release regarding claims for copyright infringement, with respect to such person’s released claims regarding one or more musical compositions for which a certificate of registration has been issued or applied for that Spotify made available for interactive streaming and/or limited downloads during the class period.

The court authorized sending you the notice because you have a right to know about a proposed settlement of a class action lawsuit—as well as all of your options—before the court decides whether to approve the settlement. If the court approves the settlement, and objections or appeals relating to the settlement are resolved, the benefits provided for by the settlement will be available only to members of the Settlement Class.

The notice explains the lawsuit, the settlement, your legal rights, what benefits are available, who is eligible for them, and how to get them.

Judge Nathan of the United States District Court for the Southern District of New York is overseeing this case, which is captioned Ferrick v. Spotify USA Inc., No. 1:16-cv-8412 (AJN). The persons and entities who sued are called the “plaintiffs,” and the company they sued, Spotify is called the “defendant.”

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2. WHAT IS THIS LAWSUIT ABOUT?

Spotify is a company that provides a digital music service that gives users on-demand access to, among other things, music.

The plaintiffs are Melissa Ferrick, Jaco Pastorius, Inc., and Gerencia 360 Publishing, Inc. They allege that they own copyrights for which registration has been issued or applied for in musical compositions that Spotify made available for interactive streaming and/or limited downloading without a license, and that Spotify did so with respect to other musical compositions owned by others. The plaintiffs allege that Spotify is liable to the Settlement Class for copyright infringement in violation of 17 U.S.C. §§ 101 et seq.

Spotify believes that plaintiffs’ factual and legal allegations in the lawsuit are incorrect and specifically denies any fault, wrongdoing, or liability to plaintiffs or the Settlement Class. In the lawsuit, Spotify has asserted defenses to the claims raised by plaintiffs.

The notice does not imply that there has been any finding of any violation of the law by Spotify or that any recovery could be had in any amount. Although the court has authorized that the notice be distributed regarding the proposed settlement, the notice does not express the opinion of the court on the merits of the claims or defenses asserted by either side in the lawsuit.

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3. WHY IS THIS A CLASS ACTION?

Class actions are lawsuits in which the claims and rights of many people are decided in a single court proceeding. One or more people—sometimes called “class representatives” or “class plaintiffs”—sue on behalf of people who have similar claims. All of the people who have similar claims form a “class” and are “class members.” A settlement in a class action—if approved by the court—resolves the claims for all class members, except those who exclude themselves from the class. Here, the class is called the “Settlement Class.”

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4. WHY IS THERE A SETTLEMENT?

The court did not decide in favor of either side in the lawsuit. Neither the plaintiffs nor Spotify have won or lost.

Instead, the lawyers representing plaintiffs and the Settlement Class, called “Class Counsel,” have investigated the facts and applicable law regarding the plaintiffs’ and the Settlement Class’s claims and Spotify’s defenses. The parties have engaged in lengthy and arms’-length negotiations in reaching this settlement. The plaintiffs and Class Counsel believe that the proposed settlement is fair, reasonable, and adequate under the circumstances, and that entering into this settlement is in the best interests of the Settlement Class. Both sides agree that, by settling, Spotify is not admitting any liability or that it did anything wrong, but both sides want to avoid the uncertainty, delay, and expense of continuing to litigate.

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5. HOW DO I KNOW IF I AM A PART OF THE SETTLEMENT?

To be included in the settlement, you must be a member of the Settlement Class. To be in the Settlement Class, you must satisfy three requirements:

  • First, you must be the owner of the copyright in a musical composition.
  • Second, you or someone else must have applied for or received a certificate of registration from the United States Copyright Office on or before June 29, 2017.
  • Third, Spotify must have made that musical composition available for interactive streaming and/or limited downloading without a license between December 28, 2012 and June 29, 2017.

Even if those three requirements are met, you are excluded from the class, and thus are not a member of the class, if you are any of the following:

  • Spotify or one of its affiliates, employees, or counsel;
  • a federal, state, or local governmental entity, including the United States District Court for the Southern District of New York;
  • a party to a Participating Publisher Pending and Unmatched Usage Agreement entered into in 2016 in connection with the Pending and Unmatched Usage Agreement, dated as of March 17, 2016, between Spotify and the National Music Publishers’ Association;
  • someone who has agreed not to bring a claim against Spotify in this class action or who has already provided Spotify with a release regarding claims for copyright infringement, to the extent that the release covers musical compositions that Spotify made available for interactive streaming and/or limited downloading between December 28, 2012 and June 29, 2017.

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6. I’M STILL NOT SURE IF I AM INCLUDED?

If you are still not sure whether you are included, you can review the Settlement Agreement and other Court Documents here.

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7. WHAT DOES THE SETTLEMENT PROVIDE?

If you are a member of the class, you may receive benefits under the settlement. If the proposed settlement is granted final approval by the court, and after any appeals are resolved, Spotify has agreed to do the following:

  • Pay a total of $43.45 million into an account. That amount, plus any interest earned in the account, will be the Settlement Fund. After deductions for any court-approved award of fees and costs to Class Counsel and incentive awards to plaintiffs for their service, the remainder—the Net Settlement Fund—will be used to make payments to members of the Settlement Class who submit timely and valid claim forms. The claim form will be available here, and can be submitted online or mailed to the Settlement Administrator, at PO Box 10371, Dublin, OH 43017-5571. Settlement Class Members who submit valid and timely claim forms will receive a pro rata share of the Net Settlement Fund. Specifically, each class member’s share will be the percentage of the Net Settlement Fund equal to the number of streams of that class member’s claimed musical compositions divided by the total number of streams of all class members’ claimed musical works. In the event that a class member is only a partial owner of the copyright of a claimed musical work, that class member’s share will be discounted in accordance with that class member’s ownership stake.
  • Pay all Settlement Administration Costs and Notice Costs. In addition to the Settlement Fund, Spotify will pay all settlement administration costs and notice costs incurred by the Court-appointed Settlement Administrator, GCG, including all media costs for Publication Notice. The Settlement Administrator has estimated that these costs will exceed $1 million and may approach $2 million.
  • Pay ongoing statutory mechanical royalties. In addition to the Settlement Fund, Spotify will pay all Settlement Class members who submit valid claim forms the mechanical license royalties calculated in accordance with 37 C.F.R. §§ 385.10-17 for the musical compositions in the future. Settlement Class members who sent in valid claim forms in time to receive a payment from the Net Settlement Fund will be sent statutory mechanical license royalties automatically as they accrue in accordance with the process outlined in the settlement agreement. Settlement Class members who missed that deadline may still receive future statutory mechanical license royalties if they later submit a claim form, which will be available online, in accordance with the process outlined in the settlement agreement.
  • Establish a Mechanical Licensing Committee. This committee will develop proposals to facilitate the mechanical licensing of content on Spotify’s service.
  • Coordinate industry efforts to share publisher catalog data and digitize pre-1978 Copyright Records and make them available online for free use by the public. Spotify will establish a procedure to receive information from publishers about their catalogs of musical works in order to reduce the number of works that cannot be matched to copyright records so that mechanical license royalties may be paid. Spotify will also organize music industry participants to promote the sharing of catalog data and the digitization of old U.S. Copyright Records so that they may be posted on a website for free public use.

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8. HOW CAN I GET A PAYMENT FROM THE SETTLEMENT FUND?

To be eligible for a payment from the Net Settlement Fund, members of the Settlement Class must fully complete and timely submit a valid claim form to the Settlement Administrator, GCG. Claim forms will be available no later than 30 days after the Effective Date. To complete the claim form, Settlement Class members must provide some information about themselves, such as their names and contact information, and about relevant musical compositions (i.e., those that were made available by Spotify for interactive streaming and/or limited downloads between December 28, 2012 and June 29, 2017, for which you contend that Spotify did not have a license). The required information includes the copyright registration number for each musical composition and the track identifier for each recording on Spotify of that composition. The claim form also requests optional information that Settlement Class members may, but need not, provide in order to be eligible for a payment. Spotify has assembled a track database to facilitate the submission of claim forms by Settlement Class Members. The Spotify Track Database consists of tracks, including Spotify track identifier and certain other available information about recordings, that Spotify made available for interactive streaming and/or limited downloading during the Class period. The track database will be available online no later than 30 days after the Effective Date.

To receive a payment from the Net Settlement Fund, claim forms must be fully completed and submitted to the Settlement Administrator either online here or by mail (to Ferrick v. Spotify, c/o GCG, P.O. Box 10371, Dublin, OH 43017-5571) postmarked no later than 210 days after the Settlement Claims Start Date.

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9. HOW CAN I GET FUTURE PAYMENTS OF MECHANICAL LICENSE ROYALTIES?

Any Settlement Class member who submits a timely and valid claim form and receives a payment from the Net Settlement Fund will also receive quarterly payments of statutory mechanical license royalties automatically. Those Settlement Class members do not need to do anything else (except to update the Settlement Administrator and Spotify of any future changes to their contact information).

Settlement Class members who missed the deadline to request payment from the Net Settlement Fund can still request quarterly payments of statutory mechanical license royalties. To do so, Settlement Class members must fully complete a claim form that will be available here and either submit it online or by mail to Ferrick v. Spotify, c/o GCG, P.O. Box 10371, Dublin, OH 43017-5571.

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10. WHEN WOULD I GET THESE BENEFITS?

The court will hold a hearing on December 1, 2017 to decide whether to grant final approval to the settlement. If the settlement is approved, there may be appeals. Payments to Settlement Class members will be made only after the settlement is finally approved and any appeals are resolved in favor of the settlement. This may take some time, so please be patient.

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11. WHAT AM I GIVING UP TO STAY IN THE CLASS AND GET PAYMENTS?

Upon the court’s approval of the settlement, the Settlement Class members who do not exclude themselves will release and forever discharge Spotify (and any of its current or former direct or indirect parents, subsidiaries, affiliates, assigns, predecessors, and successors, as well as any agents, attorneys, directors, employees, insurers, investors, officers, representatives, direct or indirect shareholders, or trustees of Spotify or any of those entities) from all of the settled claims. That means that you will no longer be able to sue Spotify (or the other released parties) regarding any of the settled claims if you are a Settlement Class member and do not timely and properly exclude yourself from the Settlement Class.

The claims that are being settled and released are all claims—whether known or unknown—with respect to a musical work that Spotify made available for interactive streaming and/or downloading during the Class Period (between December 28, 2012 and June 29, 2017) that were, could have been, or could ever be asserted as a consequence of Spotify’s making the work available for interactive streaming and/or downloading without a valid license during the Class Period, including Spotify’s marketing or promoting that fact. In addition, Settlement Class members expressly waive and relinquish the provisions of California Civil Code § 1542 (and all other similar provisions of law) to the full extent that these provisions may be applicable. California Civil Code § 1542 provides:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN TO HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.

The full text of the settlement agreement, which includes all of the provisions about settled claims and releases, is available here.

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12. WILL THE CLASS REPRESENTATIVES RECEIVE ANY COMPENSATION FOR THEIR EFFORTS IN BRINGING THIS CLASS ACTION?

Ferrick; Jaco Pastorius, Inc.; and Gerencia 360 Publishing, Inc. will request incentive awards of up to $25,000 each for their services as class representatives and their efforts in bringing the class action. The court will make the final decision as to the amount, if any, to be paid to the class representatives

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13. HOW DO I GET OUT OF THE SETTLEMENT?

If you choose to be excluded from the Settlement Class, you will not be bound by any judgment or other final disposition of this class action. You will retain any claims against Spotify that you might have. To request exclusion, you must state in writing our desire to be excluded from the Settlement Class. You must sign your request for exclusion personally or by legal counsel. Your request must include: (1) your full legal name and contact information; (2) the copyright registration numbers for your musical compositions that you are excluding from the settlement; (3) a statement that you want to be excluded from the Settlement Class; and (4) your signature.

You may request exclusion by writing a letter or using the form available here. You may also obtain a request for exclusion form from the Settlement Administrator by emailing info@SpotifyPublishingSettlement.com or calling 1-855-474-3853.

Requests for exclusion must be made on an individual basis and mailed no later than September 12, 2017, addressed to:

Ferrick v. Spotify
c/o GCG
PO Box 10371
Dublin, Ohio 43017-5571

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14. IF I DON’T EXCLUDE MYSELF, CAN I SUE SPOTIFY ABOUT THIS LATER?

No, if you are a member of the Settlement Class. If you do not exclude yourself, you forever give up the right to sue Spotify for all of the claims that this settlement resolves.

If you submit a valid and timely request to be excluded, you cannot object to the proposed settlement. But you may sue or continue to sue Spotify about the same claims resolved by this settlement in the future. You will not be bound by anything that happens in this class action.

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15. IF I EXCLUDE MYSELF, CAN I GET BENEFITS FROM THIS SETTLEMENT?

No. If you exclude yourself, you are not part of the settlement.

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16. WHAT HAPPENS IF I DO NOTHING AT ALL?

If you are a Settlement Class member and do nothing, and you do not exclude yourself, you will not be able to start or proceed with a lawsuit, or be part of any other lawsuit, against Spotify and the other released parties about the settled claims in this case.

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17. DO I HAVE A LAWYER IN THIS CASE?

The court has appointed Gradstein & Marzano, P.C., and Susman Godfrey L.L.P. as Class Counsel to represent the interests of all Settlement Class members. If you want to be represented by your own lawyer, you may hire one at your own expense.

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18. HOW WILL THE LAWYERS BE PAID?

The Court will determine how much Class Counsel will be paid for fees and expenses. Class Counsel can seek an award for attorneys’ fees of $5 million for, among other things, the future monetary and non-monetary benefits conferred, to be paid by Spotify and not from the Settlement Fund, and up to one-third of the Settlement Fund, plus reimbursement of expenses, to be paid out of the Settlement Fund. You will not be responsible for direct payment of Class Counsel’s fees and expenses. To see a copy of Class Counsel’s application for attorneys’ fees and costs, which will be available before the hearing on the fairness of the settlement, please click here.

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19. HOW DO I TELL THE COURT THAT I DON’T LIKE THE SETTLEMENT?

You can object to the Settlement if you do not like any part of it. You must give the reasons why you think the court should not approve the Settlement. To object, you must deliver to the Settlement Administrator, Settlement Class Counsel and Spotify’s counsel, and file with the court, a written statement of any objections that you might have. The written statement must include (i) your full name, address, telephone number, email address, and signature; (ii) the specific reasons why you object to the settlement, including any evidence and legal authority that you would like the court to consider; and (iii) the copyright registration number for each musical composition you own that Spotify made available for interactive streaming and/or limited downloading without a license between December 28, 2012 and June 29, 2017. If you object, you must also list any other objections by you, or your attorney representing you in this action, to any class action settlements submitted to any court in the United States in the previous five years.

You must send a copy of your objection by U.S. mail to the 6 different places listed below, postmarked no later than September 12, 2017.

Court Settlement Administrator Spotify’s Counsel
Clerk’s Office United States District Court for the Southern District of New York Thurgood Marshall United States Courthouse 40 Foley Square New York, NY 10007 Ferrick v. Spotify c/o GCG PO Box 10371 Dublin, Ohio 43017-5571 John Nadolenco Mayer Brown LLP 350 South Grand Avenue, 25th Floor Los Angeles, CA 90071

Class Counsel
Henry Gradstein Maryann R. Marzano Gradstein & Marzano, P.C. 6310 San Vicente Boulevard, Suite 510 Los Angeles, CA 90048 Steven G. Sklaver Kalpana D. Srinivasan Susman Godfrey L.L.P. 1901 Avenue of the Stars, Suite 950 Los Angeles, CA 90067 Stephen E. Morrissey Susman Godfrey L.L.P. 1201 3rd Avenue, Suite 3800 Seattle, WA 98101

The court will hold a hearing on the fairness of the settlement and to decide whether to grant it final approval on December 1, 2017. If you or your attorney intends to make an appearance at the hearing and you have not so indicated in your objection, you must also deliver, according to the same procedures, no later than September 12, 2017, a written notice of intention to appear. Any attorney hired by a Settlement Class member to represent him or her and appear at the hearing must also file a notice of appearance with the court, and serve Class Counsel and Spotify’s Counsel at the addresses above, no later than September 12, 2017.

If you fail to comply with these requirements or fail to submit your objection before the deadline, you will be deemed to have waived all objections and will not be entitled to speak at the December 1, 2017 hearing.

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20. WHAT IS THE DIFFERENCE BETWEEN OBJECTING AND EXCLUDING MYSELF?

Objecting is simply telling the court that you don’t like something about the settlement. You can object only if you stay in the Settlement Class. Excluding yourself is telling the court that you don’t want to be part of the Settlement Class. If you exclude yourself, you cannot object to the settlement because it no longer affects you.

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21. WHEN AND WHERE WILL THE COURT DECIDE WHETHER TO APPROVE THIS SETTLEMENT?

The court has preliminarily approved the settlement and will hold a hearing to determine whether to give final approval to the settlement. The purpose of this hearings is to determine: (i) whether the settlement should be approved as fair, reasonable, adequate, and in the best interests of the Settlement Class; (ii) whether to grant the Class Counsel’s request for an award of attorneys’ fees and costs; and (iii) whether to grant incentive awards to the class representatives.

The court will hold the fairness hearing on December 1, 2017 at United States District Court for the Southern District of New York, Thurgood Marshall United States Courthouse, 40 Foley Square, New York, NY 10007, Courtroom 906, before the Honorable Alison J. Nathan. The hearing may be postponed to a different time or location without additional notice, so it is recommended that you periodically check this website for updated information.

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22. DO I HAVE TO COME TO THE HEARING?

No, you are not required to attend the fairness hearing. But you are welcome to attend the hearing at your own expense. If you send written objections, you do not have to come to the hearing to talk about them. As long as you submitted the written objections in compliance with the requirements ordered by the court and they were received on time, the court will consider them. You also may pay your own lawyer to attend the fairness hearing, but it is not necessary.

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23. MAY I SPEAK AT THE HEARING?

As described above in FAQ 19, you may speak at the fairness hearing only if: (i) you have timely served and filed an objection; and (ii) you have followed the procedures set forth in FAQ 19 for notifying the court and the parties that you intend to speak at the hearing. You cannot speak at the hearing if you exclude yourself from the settlement.

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24. HOW DO I GET MORE INFORMATION ABOUT THE SETTLEMENT?

The notice summarizes the proposed settlement. To see a copy of the actual settlement agreement, the complaints filed in this lawsuit, the court’s preliminary approval order, Class Counsel’s application for attorneys’ fees and costs and incentive awards, and other information about the settlement, please click here. This website will also provide information about the status of the settlement and if it has been approved by the court.

You may also contact the Settlement Administrator at info@SpotifyPublishingSettlement.com by calling toll-free 1-855-474-3853.

To see the papers filed with the court and a history of this lawsuit, you may visit the PACER website for the court, https://ecf.nysd.uscourts.gov, and reference the docket for Ferrick v. Spotify USA Inc., No. No. 1:16-cv-8412 (AJN). You may also view the papers filed with the court during regular business hours at the office of the Clerk of the Court, United States District Court for the Southern District of New York, 40 Foley Square, New York, NY 10007. The full settlement agreement and the pleadings filed in this lawsuit can be requested, in writing, from Class Counsel identified in FAQ 19 above.

PLEASE DO NOT ADDRESS ANY QUESTIONS ABOUT THE SETTLEMENT OR LITIGATION TO THE CLERK OF THE COURT OR THE JUDGE.

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