Tidal Ditches Execs, Faces $5M Royalty Lawsuit

Jay Z's Tidal music service is having a terrible, horrible, no good, very bad week.

The company was hit Sunday with a $5 million class-action lawsuit that alleges it failed to pay artist royalties. And now, the celebrity-owned service fired its CFO and COO.

Tidal officially arrived in October 2014, but got a star-studded launch in March 2015—two months after Jay Z purchased Tidal's parent company Aspiro for $56 million. The first artist-owned music-streaming service with a focus on high-quality audio, Tidal is backed by some famous friends, including Alicia Keys, Beyonce, Kanye West, Madonna, Nicki Minaj, Rihanna, Usher, and Daft Punk.

But Yesh Music, LLC and John Emanuele from the band American Dollar claim Tidal streamed 116 of the group's copyrighted songs without making royalty payments. According to the suit, Tidal may have used faulty numbers to reimburse artists, paying them as much as 35 percent less than what was owed.

Jay Z's corporation, however, chalks the case up to nothing more than a mix-up.

"Tidal is up to date on all royalties for the rights to the music stated in Yesh Music, LLC and John Emanuele's claim and they are misinformed as to who, if anyone, owes royalty payments to them," the group said in a statement to PCMag. "Their dispute appears to be over the mechanical licenses, which we are also up to date on payments."

All tunes associated with Yesh Music, LLC and John Emanuele has since been removed from the service.

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"This claim serves as nothing other than a perfect example of why America needs Tort reform," the statement said.

But Tidal's troubles don't end with proposed changes to the civil justice system: On Tuesday, reports surfaced that Chief Financial Officer Chris Hart was dismissed after two years over a squabble about user and streaming numbers; COO Nils Juell is also out, Tidal confirmed to PCMag.

For more, see PCMag's review of Tidal for Android.