A United States federal judge has rejected a request by the Mechanical Licensing Collective (MLC) to appeal a central bundling ruling in its lawsuit against Spotify, keeping the case in district court for discovery.
Spotify secured a win in 2025 when Judge Torres agreed that Spotify Premium qualifies as a bundle under Phonorecords IV because it offers both music and audiobooks. The MLC has said the classification means Spotify will owe songwriters potentially hundreds of millions of dollars in unpaid royalties.
Interlocutory appeal denied#
The MLC, which is pursuing an amended lawsuit against Spotify, asked the court to certify the bundling question for review by the U.S. Court of Appeals for the Second Circuit.
“If the Second Circuit ultimately disagrees with the Order [dismissing the MLC’s initial action], the MLC’s original claims would be reinstated, requiring re-litigation of the case with additional discovery, additional motion practice, and a second trial,” the MLC said. “Granting interlocutory review now would allow for the full and final resolution of all of the MLC’s claims together, without duplicative proceedings.”
Judge Torres declined, writing that the plain text of Section 385.2 leaves no ambiguity about whether Premium combines products or services of more than token value with a music streaming subscription.
“But, even were the Court to agree with MLC, ‘room for reasonable disagreement’ concerning the Court’s prior holding is not a sufficient reason to depart from the final judgment rule and certify an interlocutory appeal,” the judge wrote. “Allowing parties to pepper the Second Circuit with interlocutory appeals anytime a Court’s order could be ‘reasonably’ disagreed with would pose a significant obstacle to efficient and expedient appellate review.”
Selective enforcement defense rejected#
Spotify also argued that the MLC was selectively enforcing Section 115 of the Copyright Act. Judge Torres rejected that position, citing a prior SoundExchange v. Muzak case.
“Spotify’s argument fails because, even accepting as true its claim that MLC is selectively enforcing § 115 of the Copyright Act, nothing about that selective enforcement constitutes ‘unconscionable conduct,’” Judge Torres wrote.
The court added that Spotify offered no statutory source requiring the MLC to apply Section 115 in the same manner and at the same time against all competitors. As a result, the selective enforcement defense is no longer available, and the bundling determination will not go to the Second Circuit on an interlocutory basis.
Discovery timeline#
Discovery is underway. In late July, the court extended the corresponding deadlines into November, while noting that “further extensions to this schedule are unlikely to be granted” because the suit has “now been pending for over 2 years.”
