Spotify Sued Over Systemic Misrouting and Phantom Identities

NORWALK, CT, September 09, 2026 /CourierPR/ -- Independent artist and attorney Mark M. Kratter has filed a Motion for Leave to File a Third Amended Complaint in federal court, expanding the lawsuit against Spotify. The new complaint, which includes three additional counts, alleges systemic misrouting, phantom identities, and metadata failures that have diverted earnings and suppressed visibility for independent artists.

Kratter's proposed Third Amended Complaint, filed in the United States District Court for the District of Connecticut, addresses what the filing describes as significant issues within Spotify's ingestion and routing systems. The case now includes nine counts, expanding the scope to cover systemic misrouting, misattribution, and false designation of origin.

Count 6, "Systemic Misrouting and Diversion of Earnings," alleges that Spotify's ingestion and identity-mapping systems have caused misrouting of streams, misattribution of plays, improper identity merges and splits, and phantom identities that absorb traffic. These failures have resulted in material loss of earnings, suppressed visibility, and false origin attribution for independent artists.

Two additional federal Lanham Act claims are also part of the expanded complaint. Count 7, "False Designation of Origin," alleges that Spotify's ingestion pipeline misinterprets standard metadata, generating phantom identities and fragmenting catalogs, thereby misrouting listeners. Count 8, "False Advertising," claims that Spotify publicly represents its reporting data as accurate while generating physically impossible outputs, such as saves without listeners, duplicate saves, and save counts exceeding stream counts.

The filing highlights broader industry concerns, including Spotify's 1,000-stream threshold, under which 82% of artists receive no payout. Public reporting indicates that this rule results in approximately $47 million in earnings withheld from independent artists annually. Kratter argues that the 1,000-stream threshold disproportionately impacts independent artists, diverting earnings away from non-major catalogs and toward major-label catalogs.

Kratter's goal is to seek accountability, transparency, and remedies for the systemic issues that have harmed independent artists for years. He encourages independent artists who have experienced misrouting, misattribution, or data irregularities to reach out and share documentation or organize their materials to help present accurate, well-structured information.

Independent artist Mark M. Kratter, known for his six-band creative ecosystem inspired by Chabad values, Jewish identity, and a commitment to producing clean, uplifting, family-safe music across multiple genres, is the plaintiff in this case. His catalog, containing over 2,000 original songs and 140 releases, focuses on creating spiritually aligned, family-safe music that uplifts listeners without compromising values.