New technologies exist today that were not available in the past, including music listening apps, music listening hardware, digital assistants, etc. that make music usage much more easily detectable by creators, publishers, fans and tracking services than in recent years. This has led to a surge of copyright infringement claims against businesses that play unlicensed music.
Businesses that fail to obtain a valid music license in advance of music being played on their premises, websites, digital properties, or at their events, are infringing on Copyright Law and exposing themselves to statutory damages per the U.S. Copyright Act (17 U.S.C. § 501(a)) of up $150,000 per song played, plus payment of the copyright holder's attorney fees. This can quickly lead to millions or tens of millions of dollars of financial exposure.
Additionally, due to the materiality of the financial penalties related to violating U.S. Copyright Law, the failure to properly license music is often an event that requires disclosure by a company to its financial statement auditors. This can result in a company being required to disclose the existence of copyright infringements in its audited financial statement notes, or depending on the materiality of the infringements, losing its unqualified audit opinion status, which can trigger a host of unfavorable events with lenders and various other company stakeholders.
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