Grooveshark appears to be preparing for a grand battle with Universal Music Group (UMG)! As was previously reported, UMG has filed a complaint in New York against Escape Music Group (the owners of Grooveshark) alleging that Grooveshark executives and employees illegally uploaded hundreds of thousands of UMG artists’ tracks for users to stream. Digital Music News (DMN) has secured a copy of the complaint, and as suspected, it includes a quote from an anonymous DMN user who claims to be a Grooveshark employee where he or she explains how the internal workings of Grooveshark mandate, encourage, and incentivize the uploading of non-authorized content to Grooveshark’s site.
In the wake of the complaint, Grooveshark has preemptively contacted DMN to warn them of potential subpoena requests from either Grooveshark or UMG, stating that, “I must request that you preserve all electronic information and any other records related to that comment, as it can be reasonably anticipated that either Grooveshark or Universal may find it necessary to subpoena such information as the case progresses.” DMN noted that UMG has yet to contact them in any way regarding the comment or the larger dispute.
And why would they? Though the anonymous comment is very intriguing, it’s not the kind of thing that would reasonably hold up in court. The emails included at the end of the complaint, mainly from Grooveshark Executive Chaiman Sina Simantob, do a much better job at setting up UMG for a successful takedown of Grooveshark. In one email to a potential investor, Andrew Lipsher of Greycroft, LLC, Simantob states that Grooveshark “bet the company on the face that it is easier to ask for forgiveness than it is to ask for permission.” In a subsequent email exchange between Simantob and an investor, Simantob goes out of his way to point out how they’re using the labels by stating that, “we are achieving all this growth without paying a dime to any of the labels.”
Simantob goes on to explain that the underlying scheme at play with Grooveshark is to upload songs illegally to get users interested in the content, reach a certain number of unique page views to get corporations interested in the data they’re collecting, then work out minuscule compensation packages with the labels after the fact, at which point they’d be making more money on selling data than they would be paying out fees to rights holders. Kind of a ballsy move to lay it all out in an email.
Good luck Grooveshark — it was nice knowing you while you lasted!