Spotify in the Crosshairs: Streaming Royalties and Alleged Fraud

Two major legal challenges are putting Spotify’s payment models under a microscope. A class action lawsuit alleges the streamer allows massive artificial streaming, with Drake’s catalog singled out as a key beneficiary, costing other artists hundreds of millions. At the same time, Spotify is aggressively defending its use of an audiobook bundling model that significantly reduces what it pays songwriters. The cases represent a fundamental legal assault on how the world’s largest audio platform counts streams and calculates payouts.

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ChaseLawyers Newsletter
November 04, 2025

Hi there,

This week’s legal spotlight is fixed firmly on Spotify, with two major lawsuits challenging the integrity of its payment systems from different angles.

First, a class action led by artist RBX makes explosive claims that Spotify allows massive streaming fraud to flourish. The suit singles out Drake as a primary beneficiary, alleging that billions of his streams are artificial, generated by bot networks and VPNs. This practice, the suit argues, illegally diverts hundreds of millions in royalties from legitimate artists due to Spotify's pro-rata payment model.

In a separate, ongoing dispute, Spotify is pushing back against The MLC's revised lawsuit over its audiobook bundling strategy. After a judge ruled Spotify could bundle audiobooks into its Premium tier, the new fight is over the accounting. The MLC claims Spotify's $9.99 standalone audiobook price—used to calculate lower music royalty rates—is overblown and misleading. Spotify's response is characteristically bold, calling the claims "baseless" and even questioning The MLC's motivations for pursuing the case.

Both legal battles underscore a central tension in the streaming era: as platforms innovate and grow, their methods for valuing and paying for music are facing unprecedented legal scrutiny.

Drake and Spotify Accused of Facilitating "Billions" in Fraudulent Streams

A new class action lawsuit against Spotify alleges the platform is “all too happy to turn a blind eye” to systemic streaming fraud, with Drake named as a key beneficiary. The suit, filed by rapper RBX, claims a “substantial” percentage of Drake’s 37 billion streams between 2022 and 2025 were inauthentic, generated by a “sprawling network of Bot Accounts” and manipulated using VPNs to obscure their origin. While Drake is not accused of direct involvement, the suit argues this artificial inflation unfairly reduces the royalty pool for all other artists, costing them an estimated hundreds of millions of dollars. Spotify has denied benefiting from artificial streaming, pointing to its anti-fraud systems.

Spotify Fires Back at MLC in Audiobook Royalty Dispute

Spotify has filed a robust response to The MLC's amended lawsuit over its controversial bundling practices, questioning the collecting society's "motivations." After a judge previously sided with Spotify on its right to bundle audiobooks with music, the new case focuses on how the company applies the resulting discount. The MLC argues Spotify’s $9.99 standalone audiobook price—used to calculate the non-music portion of a bundled subscription—is inflated and that the product is itself a bundle. Spotify refutes this, calling its pricing "conservatively low" and the new claims "peripheral issues" that will not result in a significant royalty increase for songwriters.

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INDUSTRY NEWS

Drake Accused of Earning Billions of Fraudulent Streams in Class Action Suit Against Spotify

A class action claims artificial streams for Drake on Spotify have cost other artists hundreds of millions in lost royalties.

Spotify questions MLC’s “motivations” in pursuing audiobook bundling dispute lawsuit

In the audiobook bundling case, Spotify says The MLC’s continued litigation raises “serious questions” about its motivations.

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