Universal Music Group is suing the world’s biggest music distributor by volume, DistroKid.

In its lawsuit, UMG, the world’s largest music rights company, alleges that DistroKid has “engaged in both deceptive trade practices and blatant copyright infringement”.

Key parts of UMG’s suit center on DistroKid’s alleged involvement with AI-made music.

The suit is careful to draw a line, however, noting that UMG’s complaint is “not about the distribution of AI-generated music when clearly disclosed as such,” but about DistroKid allegedly “masquerading as something it is not and benefiting from that false impression.”

The lawsuit, which you can read in full here, states: “DistroKid misleads the market in critical respects: it gives the false impression (1) that the music DistroKid distributes consists of artist-backed releases, created and owned by real human artists (not AI mass-generated content); (2) that DistroKid acts in furtherance of the Digital Services’ policies and the Music Fights Fraud Alliance’s initiatives to stop the mass upload of AI “slop” and other manipulative tactics aimed at generating revenue by crowding out human creators; and (3) that DistroKid takes a stance against copyright infringement.

“In reality, DistroKid embraces all of this bad-actor conduct; doing so benefits its growth and corresponding market valuation. The ramifications are felt by legitimate players in the music industry, including artists, consumers, and Plaintiffs.”

“DistroKid embraces bad-actor conduct; doing so benefits its growth and corresponding market valuation… DistroKid is flooding platforms with AI-generated ‘slop’ that siphons revenue and listeners from legitimate artists and rightsholders.”

Universal Music Group lawsuit

The UMG suit adds: “DistroKid is flooding platforms with AI-generated ‘slop’ that siphons revenue and listeners from the legitimate artists and rightsholders.

“DistroKid likewise proliferates infringing tracks across platforms, and continues that distribution even when it knows the tracks infringe [Universal and other rightsholders’] rights.”

DistroKid claims to distribute “roughly 40%” of “all new music in the world” for over 4 million artists.

In July, private equity firm CVC Capital Partners agreed a ten-figure deal to majority-acquire DistroKid – brokered on DistroKid’s behalf by Goldman Sachs and Raine Group.

The companies said that the transaction was expected to close in Q3 2026.

Filed in the US District Court for the District of Delaware, the suit seeks maximum statutory damages of $150,000 per work infringed.

UMG‘s exhibits name 1,000 specific recordings. That’s a theoretical maximum of $150 million in damages… for now: the complaint calls these 1,000 tracks “the tip of the iceberg.”

Adds the suit: “DistroKid has infringed and continues to infringe thousands of Plaintiffs’ sound recordings, and discovery will likely show thousands (or more) additional infringing works.”

In UMG’s telling, DistroKid’s “illegal, deceptive, and unlawful practices” have “fuel[ed] DistroKid’s rapid growth” while “threaten[ing] the legitimate players in the music economy.”

Continues UMG’s suit: “The consequences of this deception fall on the legitimate players in the music economy, including artists, consumers, Digital Services, and Plaintiffs. Every stream captured by a deceptive AI-generated or infringing track diverts listeners and revenue away from real artists, including Plaintiffs’ artists; consumers are misled into believing they are listening to genuine music and supporting working artists when they are in fact enriching bot farms and infringers; and the Digital Services believe that they are featuring genuine music on their platforms.

“Time and again, DistroKid concedes that it does not have rights in the sound recording… Continuing to distribute these infringing tracks allows DistroKid to collect ill-gotten revenues that should have gone to Plaintiffs and other legitimate rightsholders.”

Universal Music Group lawsuit

“The deception also gives DistroKid an unfair competitive advantage: Plaintiffs and others bear the substantial costs of trying to ensure only music backed by authentic artists and legitimately owned is distributed to Digital Services, while DistroKid does none of that work and yet is treated by the market as though it operates on the same terms. A business built on such deception makes competition unfair.

“Time and again, DistroKid concedes that it does not have rights in the sound recording. Here is where it gets egregious: after acknowledging that it does not have rights in the track, DistroKid continues to distribute that exact same recording to other Digital Services. Continuing to distribute these infringing tracks allows DistroKid to collect ill-gotten revenues that should have gone to Plaintiffs and other legitimate rightsholders.”

Of 1,551 AI music tracks submitted to SIQA’s charts in Q1 this year, 90.4% were made using Suno, and 75.8% were distributed by DistroKid.

MBW has contacted DistroKid for comment on UMG’s lawsuit.

This isn’t the first time that Universal has sued a large DIY music distribution company in recent years.

In November 2024, UMG, alongside ABKCO Music & Records and Concord Music Group, sued Believe and its DIY distribution subsidiary TuneCore in the US District Court for the Southern District of New York, seeking damages of at least $500 million.

That complaint alleged that Believe had built its business through “industrial-scale copyright infringement,” centering on sped-up and remixed versions of copyrighted recordings.

Believe said at the time that it “strongly refuted” the claims.

The two sides settled in April 2026, filing a Joint Stipulation of Dismissal With Prejudice that dismissed all claims and barred them from being refiled.

Financial terms were not disclosed, though UMG confirmed to MBW that the litigation had been resolved amicably.

Yesterday (September 14), global recorded music industry body IFPI issued a set of new anti-streaming fraud principles for labels and distributors to voluntarily abide by.

The Streaming Integrity Initiative (SII) proposes practices, including Know Your Customer (KYC) protocols for the clients of distributors.

In addition, The SII calls on its signatories to “implement measures to identify AI-generated content and vet for potential associated issues, including streaming fraud.”

The SII has 24 signatories from across the music industry, including the three major music companies, plusthe likes of Merlin, Ditto Music, Symphonic, IDOL, HYBE, and TooLost.

Those who had not signed The SII at the time of its launch included UnitedMasters, Believe/TuneCore… and DistroKid.

DistroKid was a founding member of the Music Fights Fraud Alliance, the cross-industry anti-fraud body launched in 2023 – and remains a member today.Music Business Worldwide