SoundExchange has filed a lawsuit against AccuRadio in an Illinois federal court over unpaid royalties, with AccuRadio claiming the legal action came as a complete surprise.

According to SoundExchange, AccuRadio's royalty payments slowed and stopped in 2018. While the parties reached a payment agreement in 2020, SoundExchange claims AccuRadio failed to meet the terms. An audit of royalties from 2015-2017 revealed additional unpaid amounts.

A June 2023 forbearance agreement outlined a payment plan including an initial down payment, monthly installments, and a balloon payment. SoundExchange is now seeking missed statutory and forbearance-agreement royalties, plus a full accounting of royalties since June 2021.

Kurt Hanson, AccuRadio's Founder & CEO, states they have been actively negotiating a payment plan with SoundExchange for months and believed both parties were working in good faith. He clarifies that AccuRadio resumed full payments in early 2021 and continued until recently.

Hanson highlights a key industry challenge: webcasters face disproportionately high royalty rates compared to other broadcast mediums. While AM/FM stations pay no sound recording royalties for terrestrial broadcasts and satellite radio reportedly pays around 15% of revenue, AccuRadio's SoundExchange royalty obligations have reached 45-78% of its revenues.

AccuRadio remains committed to working with SoundExchange, either directly or through legal channels, to establish a fair payment plan for past obligations and resume current payments as soon as possible.

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