Musicians Union Sues UMG and WMG for Breach of Contract Over AI Licensing Settlements

The American Federation of Musicians (AFM) has initiated legal action against Universal Music Group (UMG) and Warner Music Group (WMG), alleging that its members are not benefiting from the major labels’ lucrative licensing agreements with AI music companies Suno and Udio. The lawsuit, filed on June 5, 2026, asserts that these agreements violate the collective bargaining agreement between the AFM and the music companies.

Details of the Lawsuit

The AFM, representing session musicians, claims that UMG and WMG have licensed sound recordings featuring AFM-represented musicians without providing compensation or credit. The complaint highlights that the two major labels have failed to disclose which recordings and whose work are being licensed to the AI companies. This lack of transparency is a central issue in the lawsuit.

The AFM’s legal action comes in the wake of significant copyright settlements reached by UMG and WMG at the end of 2025. These settlements allow popular music AI models to be trained on licensed works, yet the AFM contends that its members are not sharing in the financial benefits from these arrangements.

Background on AI Licensing Settlements

In 2024, UMG and WMG, along with Sony, filed lawsuits against Suno and Udio, alleging that both AI models had been unlawfully trained on millions of copyrighted recordings. UMG and WMG subsequently reached settlements with Udio, permitting the company to develop a new model based on licensed works that would remain within a controlled environment. WMG also settled with Suno, agreeing to a licensed training model that allows for broader distribution beyond the platform. UMG continues to pursue legal action against Suno, while Sony has yet to settle with either AI company.

Currently, Suno and Udio are in the process of developing new models utilizing licensed music. However, the AFM’s lawsuit claims that these companies are not sharing the proceeds from the major labels’ training licenses with the musicians whose work is being utilized.

Allegations of Breach of Contract

The AFM argues that the actions of UMG and WMG constitute a breach of their collective bargaining agreement, which mandates that the majors compensate musicians for “new uses” of their music. The union also asserts its right to know which specific recordings are being incorporated into the training sets of Suno and Udio, a request that has reportedly gone unaddressed by the major labels.

In response to the lawsuit, a spokesperson for UMG stated that the company has been proactive in protecting the rights of artists and songwriters in the context of AI. The spokesperson emphasized UMG’s commitment to responsible AI licensing agreements and ongoing legislative efforts to safeguard artists’ interests.

Statements from Music Industry Leaders

The UMG spokesperson noted that the AFM’s decision to pursue legal action during collective bargaining negotiations was unexpected. The spokesperson expressed hope for a continued strong working relationship with the AFM, built on mutual respect for musicians.

Similarly, WMG issued a statement expressing disappointment over the AFM’s lawsuit, characterizing it as an unproductive move amid ongoing negotiations. The company reiterated its commitment to fostering a healthy AI ecosystem that benefits artists.

Representatives for Suno and Udio have not yet responded to requests for comment regarding the lawsuit.

Industry Concerns Over AI Licensing

This legal dispute underscores growing concerns among artists and their advocates about the implications of AI licensing settlements. While UMG and WMG have pledged to secure “opt-in” approval from musicians for the use of their material in AI-generated outputs, uncertainties remain regarding whether artists will receive compensation or approval for the inclusion of their works in AI training datasets.

Recent reports indicate that some record label contracts have been updated to include explicit approvals for the use of songs in AI training inputs. However, legal experts caution that major labels might rely on existing blanket license clauses, which permit them to license entire music libraries to platforms like Instagram and TikTok, potentially circumventing the need for individual artist consent.

The specifics of which music will be included in the updated, licensed models from Suno and Udio remain unclear, as does the compensation framework for artists. Both AI models are still under development.

As reported by www.billboard.com.

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Published on 2026-06-05 22:50:00 • By FAME Delivered News Desk