The American Federation Of Musicians has sued Universal Music and Warner Music over their licensing deals with AI company Udio. Warner is also being sued in relation to its Suno deal.
The union, which represents professional musicians in the US, claims that the majors have twice breached the AFM-negotiated Sound Recording Labor Agreement, used by American labels and musicians, since signing their AI deals.
First, by failing to declare what recordings are covered by the Udio and Suno licences. And second, by failing to ensure that all the AFM members who appear on those recordings are compensated for use of their performances by the AI companies.
AFM’s lawsuit notes that both Universal and Warner initially sued Udio and Suno, claiming that the AI companies had infringed their copyrights through “unauthorised and uncompensated” use of sound recordings in order to train AI models that are, the majors said, “replacing the work of human artists with massive quantities of AI-created sounds - that substantially dilute the royalty pools paid out to artists”.
But after both majors settled their litigation with Udio, and Warner also with Suno, and entered into licensing deals, both companies are now “allowing those same AI companies to use the work of AFM-represented musicians to do exactly what they warned about: training AI models to generate supposedly ‘new’ sound recordings derived from music ingested into their models”.
Which means the majors “protected their own interests and created a significant source of new revenue with the retrospective settlements and prospective licences” and then “refused to compensate the musicians whose work - created with their own instruments and through their talent, creativity and hard work - is fed into AI machines for profit”.
When it comes to the copyright obligations of AI companies like Udio and Suno, record labels, music publishers, artists and songwriters are pretty much in agreement: those companies must get permission to make use of existing music when training generative AI models by negotiating licensing deals.
Many AI businesses argue that they don’t actually need permission from rights owners, because AI training counts as ‘fair use’ under US copyright law, although that argument is being disputed in court. And while legal uncertainties remain, some AI companies have started entering into licensing deals to remove the risk of losing legal battles in the future and having to pay massive damages to rights owners.
However, as soon as labels and publishers start to do deals with AI companies, a split occurs between the corporate rightsholders and individual artists and songwriters.
Because it’s not clear how the money generated by those AI deals will be shared between stakeholders - ie labels, publishers, artists, writers. And the majors in particular plan to opt-in all the music they control into their AI deals, only getting artist and writer approval in specific scenarios.
It’s thought Udio’s new product, enabled by its licensing deals, will allow users to remix and mash up existing songs, and to replace the vocals on a track with AI-generated voice clones, so it sounds like a different artist provided the vocals. For legal reasons, the majors plan to get specific artist approval for voice clones and writer approval for remixes and mash-ups.
But, when it comes to training Udio’s actual model, the majors are seemingly planning to opt in their whole catalogues without consulting artists or writers. And it’s not clear how artists and writers will be compensated for the training, except that it seems likely that session musicians, like those in AFM and who rely on the Sound Recording Labor Agreement (or SRLA), won’t receive any payments at all.
However, AFM’s lawsuit points out that its agreement with the record industry includes a ‘new use’ provision which “requires music companies to notify AFM” of licences for the use of music in ways not covered by the SRLA, and also “to compensate the individual musicians” whose recordings are covered by any such licences. And, AFM insists, “generative AI tools constitute such a new use”.
“Despite the SRLA’s new use provision” - and despite Universal and Warner’s “acknowledgment of the threat that generative AI poses to recording artists” - the majors “have failed to compensate musicians whose music has already been scraped, ingested and copied, exploited and incorporated into the development of Suno’s and Udio’s AI models under defendants settlement agreements with them”.
Not only that, but the majors have “not even provided basic information required under the SRLA to the AFM about which recordings were licensed”, which is why the union is now filing this lawsuit, accusing the majors of breach of contract and seeking to enforce the ‘new use’ provision in its agreement.