Judge Slashes Napster Class Action Settlement That Paid Songwriters 30x Less Than Lawyers

Two years aft an appeals tribunal overturned a “measly” people enactment colony for songwriters that netted their lawyers a immense payout, a justice has present awarded those attorneys conscionable a tiny fraction of their archetypal fee.

The scathing 2023 ruling rejected a woody struck with Napster that secured conscionable $53,000 for songwriters but paid their lawyers a whopping $1.7 million. The appeals tribunal said it was precise intelligibly “unreasonable” to wage attorneys much than 30 times the magnitude they really won for their clients.

On Wednesday, a little tribunal justice heeded that informing and sharply reduced the magnitude paid to those lawyers nether the colony — each the mode down to $86,022.

“The quality betwixt the colony worth … and the [legal fees] fig … is staggering,” Judge Jeffrey S. White wrote successful the ruling, obtained by Billboard. “The tribunal truthful finds it due to substantially trim the [legal fees] figure.”

The ruling came successful a people enactment filed successful 2016 against Rhapsody, which has since rebranded arsenic Napster. It was 1 of respective specified copyright cases filed successful the mid-2010s implicit the nonaccomplishment of streaming services similar Spotify to decently wage mechanical royalties to songwriters.

But the suit — and its prospects for a ample payout — were sharply reduced by a competing people enactment organized by the National Music Publishers’ Association, which yet drained astir 98% of the imaginable people members. The transition of the Music Modernization Act, which mostly fixed the problems that led to the litigation, further reduced the scope of the case.

When Napster yet settled successful 2019, it agreed to wage arsenic overmuch arsenic $20 million. But due to the fact that NMPA’s competing suit had decimated the earlier case, Napster ended up paying lone $52,841 to the existent songwriters who chose to participate.

When it came clip to fig retired however overmuch to wage the lawyers who represented the songwriters, their fees were calculated arsenic a percent of that hypothetical $20 cardinal cap, not the existent payout — resulting successful the outsized $1.7 cardinal award.

That result shocked the U.S. Court of Appeals for the Ninth Circuit, which ruled successful 2023 that the “meager” payout to songwriters didn’t travel adjacent to warranting the monolithic reward to their attorneys: “This lawsuit volition apt marque the mean idiosyncratic shingle her caput successful disbelief,” U.S. Circuit Judge Kenneth K. Lee wrote astatine the time.

Back astatine the proceedings court, the plaintiff’s lawyers (from the instrumentality steadfast Michelman & Robinson LLP) erstwhile again asked for a large award, offering a revised petition of $1.2 million. Even if the nonstop monetary payout was small, they argued their suit had provided “significant benefits” to songwriters, including aiding the larger NMPA lawsuit and adjacent helping the transition of the MMA.

But successful Wednesday’s decision, Judge White said helium was required to grant the lawyers nary much than 25 percent of the full payment they had won for their clients. Under a revised calculation, the justice enactment that fig astatine $358,903 — meaning helium would grant conscionable $86,022 to the attorneys. That fig volition beryllium supplemented by an grant of ineligible “costs” (separate from attorney’s fees) of conscionable implicit $13,000.

One metallic lining for the plaintiffs’ attorneys? The justice besides rejected arg...