22 October 2021

CMA announces probe into music streaming platforms: Caroline Harbord comments in Solicitors Journal and Thomson Reuters Practical Law

Dispute Resolution Senior Associate, Caroline Harbord, has had her comments on the CMA's announcement of a probe into music streaming platforms published by Solicitors Journal and Thomson Reuters Practical Law. The comments were also published in Edward Fennell’s Legal Diary.

"The CMA's announcement will no doubt be of grave concern to streaming platforms such as Spotify.

If the final report suggests that such platforms have acted anti-competitively, this could lead to a gigantic "opt out" class action against the platforms (in the style of the recent Collective Proceedings Orders (CPOs) granted in Merricks v Mastercard, Le Patourel v BT and Gutmann v London and South Eastern Railway Limited).

Given how ubiquitous streaming platforms are, the potential class of claimants could extend to all individuals who have streamed music over a specified period (potentially since the inception of the platforms), and the damages could run into billions (as was the case in each of Merricks v Mastercard and Le Patourel v BT). This is leaving aside class action that the musicians themselves could also launch.

Le Patourel v BT is of particular relevance here, because the CAT made it clear in that case that a CPO, the order required before an "opt out" group action can proceed, could be granted against BT on the basis of the findings of an Ofcom market review.

As such, the findings of the music streaming market study could themselves provide sufficient evidence for a CPO to be granted against streaming platforms (whereas the more traditional school of thought was that a specific finding of anti-competitive behaviour had to be made by the European Commission or CMA).

The threshold evidential requirement for granting CPOs has therefore been lowered by Le Patourel v BT, and it seems plausible that any findings of the recently announced market study by the CMA could be enough to get an "opt out" group action against the streaming platforms off the ground."

Caroline is a Senior Associate on our Dispute Resolution team.

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