Month: October 2024

Now with added retroactive acrobatics: @DamianCollins calls on UK Prime Minister to stop Google’s “Text and Data Mining” Circus

Damian Collins (former chair of the UK Parliament’s Digital Culture Media and Sport Select Committee) warns of Google’s latest AI shenanigans in a must-read opinion piece in the Daily Mail that highlights Google’s attempt to lobby its way into what is essentially a retroactive safe harbor to protect Google and its confederates in the AI land grab. While Mr. Collins writes about Google’s efforts to rewrite the laws of the UK to free ride in his home country which is egregious bullying, the episode he documents is instructive for all of us. If Google & Co. will do it to the Mother of Parliaments, it’s only a matter of time until Google & Co. do the same everywhere or know the reason why. Their goal is to hoover up all the world’s culture that the AI platforms have not scraped already and–crucially–to get away with it. And as Guy Forsyth says, “…nothing says freedom like getting away with it.”

The timeline of AI’s appropriation of all the world’s culture is a critical understanding to appreciate just how depraved Big Tech’s unbridled greed really is. The important thing to remember is that AI platforms like Google have been scraping the Internet to train their AI for some time now, possibly many years. This apparently includes social media platforms they control. My theory is that Google Books was an early effort at digitization for large language models to support products like corpus machine translation as a predecessor to Gemini (“your twin”) and other Google AI products. We should ask Ray Kurzweil.

There is starting to be increasing evidence that this is exactly what these people are up to.

The New York Times Uncovers the Crimes

According to an extensive long-form report in the New York Times by a team of very highly respected journalists, it turns out that Google has been planning this “Text and Data Mining” land grab for some time. At the very moment YouTube was issuing press releases about their Music AI Incubator and their “partners”–Google was stealing anything that was not nailed down that anyone had hosted on their massive platforms, including Google Docs, Google Maps, and…YouTube. The Times tells us:

Google transcribed YouTube videos to harvest text for its A.I. models, five people with knowledge of the company’s practices said. That potentially violated the copyrights to the videos, which belong to their creators….Google said that its A.I. models “are trained on some YouTube content,” which was allowed under agreements with YouTube creators, and that the company did not use data from office apps outside of an experimental program. 

I find it hard to believe that YouTube was both allowed to transcribe and scrape under all its content deals, or that they parsed through all videos to find the unprotected ones subject to their interpretation of the YouTube terms of use. So as we say in Texas, that sounds like bullshit for starters.

How does this relate to the Text and Data Mining exception that Mr. Collins warns of? Note that the NYT tells us “Google transcribed YouTube videos to harvest text.” That’s a clue.

As Mr. Collins tells us:

Google [recently] published a policy paper entitled: Unlocking The UK’s AI Potential.

What’s not to like?, you might ask. Artificial intelligence has the potential to revolutionise our economy and we don’t want to be left behind as the rest of the world embraces its benefits.

But buried in Google’s report is a call for a ‘text and data mining’ (TDM) exception to copyright.

This TDM exception would allow Google to scrape the entire history of human creativity from the internet without permission and without payment.

And, of course, Mr. Collins is exactly correct, that’s exactly what Google have in mind.

The Conspiracy of Dunces and the YouTube Fraud

In fairness, it wasn’t just Google ripping us off, but Google didn’t do anything to stop it as far as I can tell. One thing to remember is that YouTube was, and I think still is, not very crawlable by outsiders. It is almost certainly the case that Google would know who was crawling youtube.com, such as Bingbot, DuckDuckBot, Yandex Bot, or Yahoo Slurp if for no other reason that those spiders were not googlebot. With that understanding, the Times also tells us:

OpenAI researchers created a speech recognition tool called Whisper. It could transcribe the audio from YouTube videos, yielding new conversational text that would make an A.I. system smarter.

Some OpenAI employees discussed how such a move might go against YouTube’s rules, three people with knowledge of the conversations said. YouTube, which is owned by Google, prohibits use of its videos for applications that are “independent” of the video platform. [Whatever “independent” means.]

Ultimately, an OpenAI team transcribed more than one million hours of YouTube videos, the people said. The team included Greg Brockman, OpenAI’s president, who personally helped collect the videos, two of the people said. The texts were then fed into a system called GPT-4, which was widely considered one of the world’s most powerful A.I. models and was the basis of the latest version of the ChatGPT chatbot….

OpenAI eventually made Whisper, the speech recognition tool, to transcribe YouTube videos and podcasts, six people said. But YouTube prohibits people from not only using its videos for “independent” applications, but also accessing its videos by “any automated means (such as robots, botnets or scrapers).”

OpenAI employees knew they were wading into a legal gray area, the people said, but believed that training A.I. with the videos was fair use. 

And strangely enough, many of the AI platforms sued by creators raise “fair use” as a defense (if not all of the cases) which is strangely reminiscent of the kind of crap we have been hearing from these people since 1999.

Now why might Google have permitted OpenAI to crawl YouTube and transcribe videos (and who knows what else)? Probably because Google was doing the same thing. In fact, the Times tells us:

Some Google employees were aware that OpenAI had harvested YouTube videos for data, two people with knowledge of the companies said. But they didn’t stop OpenAI because Google had also used transcripts of YouTube videos to train its A.I. models, the people said. That practice may have violated the copyrights of YouTube creators. So if Google made a fuss about OpenAI, there might be a public outcry against its own methods, the people said.

So Google and its confederate OpenAI may well have conspired to commit massive copyright infringement against the owner of a valid copyright, did so willingly, and for purposes of commercial advantage and private financial gain. (Attempts to infringe are prohibited to the same extent as the completed act). The acts of these confederates vastly exceed the limits for criminal prosecution for both infringement and conspiracy.

But to Mr. Collins’ concern, the big AI platforms transcribed likely billions of hours of YouTube videos to manipulate text and data–you know, TDM.

The New Retroactive Safe Harbor: The Flying Googles Bring their TDM Circus Act to the Big Tent With Retroactive Acrobatics

But also realize the effect of the new TDM exception that Google and their Big Tech confederates are trying to slip past the UK government (and our own for that matter). A lot of the discussion about AI rulemaking acts as if new rules would be for future AI data scraping. Au contraire mes amis–on the contrary, the bad acts have already happened and they happened on an unimaginable scale.

So what Google is actually trying to do is get the UK to pass a retroactive safe harbor that would deprive citizens of valuable property rights–and also pass a prospective safe harbor so they can keep doing the bad acts with impunity.

Fortunately for UK citizens, the UK Parliament has not passed idiotic retroactive safe harbor legislation like the U.S. Congress has. I am, of course, thinking of the vaunted Music Modernization Act (MMA) that drooled its way to a retroactive safe harbor for copyright infringement, a shining example of the triumph of corruption that has yet to be properly challenged in the US on Constitutional grounds.

There’s nothing like the MMA absurdity in the UK, at least not yet. However, that retroactive safe harbor was not lost on Google, who benefited directly from it. They loved it. They hung it over the mantle next to their other Big Game trophy, the DMCA. And now they’d like to do it again for the triptych of legislative taxidermy.

Because make no mistake–a retroactive safe harbor would be exactly the effect of Google’s TDM exception. Not to mention it would also be a form of retroactive eminent domain, or what the UK analogously might call the compulsory purchase of property under the Compulsory Purchase of Property Act. Well…”purchase” might be too strong a word, more like “transfer” because these people don’t intend to pay for a thing.

The effect of passing Google’s TDM exception would be to take property rights and other personal rights from UK citizens without anything like the level of process or compensation required under the Compulsory Purchase of Property–even when the government requires the sale of private property to another private entity (such as a railroad right of way or a utility easement).

The government is on very shaky ground with a TDM exception imposed by the government for the benefit of a private company, indeed foreign private companies who can well afford to pay for it. It would be missing government oversight on a case-by-base basis, no proper valuation, and for entirely commercial purposes with no public benefit. In the US, it would likely violate the Takings Clause of our Constitution, among other things.

It’s Not Just the Artists

Mr. Collins also makes a very important point that might get lost among the stars–it’s not just the stars that AI is ripping off–it is everyone. As the New York Times story points out (and it seems that there’s more whistleblowers on this point every day), the AI platforms are hoovering up EVERYTHING that is on the Internet, especially on their affiliated platforms. That includes baby videos, influencers, everything.

This is why it is cultural appropriation on a grand scale, indeed a scale of depravity that we haven’t seen since the Nurenberg Trials. A TDM exception would harm all Britons in one massive offshoring of British culture.

StubHub Class Action on Hold: Oppression is in the Eye of the Beholder

The current case of Kaiser v. StubHub (No. 1:2024cv00044 (JLR) SDNY 2024) highlights the importance of arbitration clauses in online agreements. This is particularly true in the Kaiser case when the plaintiff alleges serious and complex civil law violations that might even rise to the level of a criminal indictment or certainly a grand jury investigation. Those overarching public policy goals are cut off by the retroactive application of click-through arbitration provisions and the Federal Arbitration Act. If StubHub users like the plaintiff had any idea they were going to get ripped off, they would likely never have agreed to an arbitration clause that cut off their opportunity to be heard by a court. Meritorious plaintiffs are silenced by Silicon Valley’s web of loopholes. This is the essence of violating our Constitutional rights to due process.

In a nutshell, the facts in Kaiser are that Plaintiff Kaiser allegedly bought tickets through StubHub in the US to a major soccer game in the UK (Tottenham Hotspurs vs. Liverpool FC). The plaintiff alleged that he had received several assurances from StubHub that his tickets were authentic and in reliance made travel arrangements to the UK to attend the game. On arrival at Tottenham Hotspurs’ stadium on game day, he alleges that he was told by Hotspurs employees that his tickets were fake, that StubHub was not authorized to sell Hotspurs tickets and they knew it, and that the stadium routinely rejects numerous ticket holders from StubHub with fake tickets.

Despite the blanket class action waiver in StubHub’s terms of service (or “Global User Agreement“) requiring arbitration of all claims by a user, the Plaintiff timely filed a putative class action in NY state court alleging that StubHub engaged in the sale of invalid or bogus tickets. The current StubHub terms of service has a broad disclaimer that introduces the arbitration clause which will apply to the user before the user has any idea of a potential RICO claim:

FOR ALL USERS RESIDING IN THE UNITED STATES, PLEASE BE ADVISED: CLAUSE 22 OF THIS AGREEMENT CONTAINS AN AGREEMENT TO ARBITRATE, WHICH WILL, WITH LIMITED EXCEPTIONS, REQUIRE YOU TO SUBMIT CLAIMS YOU HAVE AGAINST US TO BINDING AND FINAL ARBITRATION, UNLESS YOU OPT-OUT. UNLESS YOU OPT OUT: (1) YOU WILL ONLY BE PERMITTED TO PURSUE CLAIMS AGAINST US ON AN INDIVIDUAL BASIS, NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY CLASS OR REPRESENTATIVE ACTION OR PROCEEDING, AND (2) YOU WILL ONLY BE PERMITTED TO SEEK RELIEF (INCLUDING MONETARY, INJUNCTIVE, AND DECLARATORY RELIEF) ON AN INDIVIDUAL BASIS.

What the clause does not say is “EVEN IF WE STEAL FROM YOU.”

According to the plaintiff, StubHub knowingly facilitated the sale of tickets that it had no authorization to sell. This fraudulent activity, Kaiser argues, has caused significant financial and emotional harm to consumers who purchased these tickets, only to find out they were invalid when attempting to use the tickets.

Although Plaintiff did not bifurcate his claims, Plaintiff’s claims can potentially be divided (or “bifurcated”) into two different categories: what might be called “contract claims” arising from StubHub’s potential breach of promises in violation of state contract laws and “statutory claims” sounding in state or federal consumer protection statutes and the federal civil Racketeer Influenced and Corrupt Organizations Act (RICO). I would argue that the contract claims could be arbitrable and the statutory claims should not be decided by an arbitrator–otherwise public policy is decided by private arbitrators with no one in sight who had been elected dog catcher.

The contract claims are:

Breach of Contract: Kaiser alleges that StubHub has breached its contractual obligations to consumers. When consumers purchase tickets through StubHub, they enter into a click-through terms of service contract with the company, expecting to receive valid tickets in return for their payment. Kaiser argues that by selling invalid tickets, StubHub has failed to uphold its end of the contract, thereby breaching their agreement with consumers on a grand scale. The agreement StubHub allegedly breached includes the company’s terms of use which has an arbitration clause as do many if not substantially all online consumer agreements. That arbitration clause is broadly drafted to purport to require arbitration of all claims, even the civil RICO count.

Unjust Enrichment: The plaintiff claims that StubHub has been unjustly enriched through its fraudulent activities. By selling invalid tickets, StubHub has profited at the expense of consumers who paid for tickets they could not use. Kaiser argues that it is unjust for StubHub to retain these profits, given the fraudulent nature of the ticket sales.

Negligence: Kaiser contends that StubHub has been negligent in its duty to ensure the validity of the tickets sold on its platform. The plaintiff argues that StubHub has a responsibility to verify the legitimacy of the tickets it sells and to protect consumers from purchasing fraudulent tickets. By failing to do so, StubHub has acted negligently, causing harm to consumers.

The “statutory” claims are:

Consumer Protection Statutes: Kaiser asserts that StubHub has violated various consumer protection laws. The plaintiff argues that StubHub’s practices are deceptive and unfair, misleading consumers into believing they are purchasing legitimate tickets. This deception, Kaiser claims, is a clear violation of consumer rights and protection statutes designed to safeguard consumers from such fraudulent activities.

Civil Racketeering: The plaintiff claims that StubHub’s actions constitute a violation of the federal Racketeer Influenced and Corrupt Organizations Act. Kaiser argues that StubHub has been operating as a criminal enterprise by engaging in a pattern of racketeering activity. This includes the fraudulent sale of tickets and the misrepresentation of the legitimacy of these tickets to consumers. By framing StubHub’s actions within the context of rackeetering, Kaiser apparently seeks to highlight the systemic and ongoing nature of the alleged fraud by StubHub.

Injunctive Relief: In addition to seeking monetary damages, Kaiser requested injunctive relief to prevent StubHub from continuing its alleged fraudulent practices. The plaintiff argues that without court intervention, StubHub will likely continue to engage in the sale of invalid tickets, causing further harm to consumers. Kaiser contended that an injunction is necessary to protect consumers and ensure that StubHub ceases its fraudulent activities.

StubHub’s Response

StubHub’s response was to seek to remove the case to federal court, which was successful, and to assert that its clickthrough arbitration agreement in the terms of use for the StubHub site was the proper forum, not a court. StubHub argued that the arbitration clause was agreed upon by the plaintiff when using StubHub’s allegedly fraudulent services. They contended that this clause was valid and enforceable, citing to the Federal Arbitration Act which favors the enforcement of arbitration agreements, asserting that the court should compel arbitration as per the agreement. Crucially, the Federal Arbitration Act was signed into law by President Calvin Coolidge in 1925–slightly pre-Internet. More about this later.

The plaintiff Kaiser argued that application of the arbitration clause was unconscionable, meaning it was unfairly one-sided and should not be enforced. Kaiser claimed that there was no mutual agreement to arbitrate due to the manner in which the terms were presented.

Judge Rochon’s Order

The case on removal was heard before U.S. District Judge Jennifer L. Rochon in the Southern District of New York. Judge Rochon’s order in the case granted StubHub’s motion to compel arbitration but stayed the case pending the completion of arbitration proceedings. Judge Rochon’s resolution did not address the merits and turned on the enforceability of the arbitration clause under the Federal Arbitration Act (FAA). The court considered several factors:

Existence of an Agreement: The court found that there was a valid agreement between the parties, as the plaintiff had accepted StubHub’s terms of service, which included the arbitration clause.

Scope of the Arbitration Clause: The court determined that the arbitration clause covered the plaintiff’s claims, as it broadly encompassed any disputes arising out of or relating to the terms of service or the plaintiff’s use of StubHub’s services including Plaintiff’s statutory RICO claims.

Unconscionability: The court rejected the plaintiff’s argument that the arbitration clause was unconscionable. Judge Rochon noted that the clause was not overly one-sided or oppressive and that the plaintiff had the opportunity to review the terms before agreeing to them and also had the ability to opt out of the arbitration clause, but did not. The Court discussed the Plaintiff’s failure to take advantage of the “opt out” clause in some detail, which I’ll speak to later in this post.

The court also addressed other motions filed by the parties:

StubHub’s Motion to Dismiss: StubHub’s motion to dismiss the complaint was denied without prejudice as moot, given that the case was being referred to arbitration. As I read it, this allowed the Court to retain jurisdiction of the case should the parties wish to pursue any post-arbitration litigation.

Plaintiff’s Cross-Motion to Amend: The plaintiff’s cross-motion to amend the complaint was denied. The court found that the proposed amendments would not change the outcome of the motion to compel arbitration.

Judge Rochon’s order emphasizes the enforceability of arbitration clauses in consumer agreements, provided they meet the legal requirements under the FAA. The decision underscores the importance of carefully reviewing and understanding the terms of service when using online platforms like StubHub as click through agreements are notorious traps for the unwary.

Chicken and Egg: StubHub’s Arbitration Opt Out

The “opt-out” clause in StubHub’s arbitration agreement plays a crucial role in determining the enforceability of the arbitration provision and the forum for resolving the case. Note that the opt out requires mailing a specific form. That’s right–mailing the form, as in snail mail. You know, because the Internet. The current version of the opt-out states:

Opt-Out Procedure

You can choose to reject this Agreement to Arbitrate (‘opt out’) by mailing us a written opt-out notice (‘Opt-Out Notice’). The Opt-Out Notice must be postmarked no later than 30 days after the date you accept the User Agreement for the first time. You may also opt out no later than 30 days upon receipt of notice that the arbitration provision is being updated or changed. You must mail the Opt-Out Notice to StubHub, Inc., Attn: Litigation Department, Re: Opt-Out Notice, 1209 Orange Street, Corporation Trust Center, Wilmington, DE 19801.

For your convenience, we are providing an Opt-Out Notice form you must complete and mail to opt out of the Agreement to Arbitrate. You must complete the Opt-Out Notice form by providing the information called for in the form, including your name, address (including street number and address, city, state, and zip code), phone number and the email address(es) used to log in to the account(s) to which the opt-out applies. You must sign the Opt-Out Notice for it to be effective. This procedure is the only way you can opt out of the Agreement to Arbitrate. If you opt out of the Agreement to Arbitrate, all other parts of the User Agreement will continue to apply. Opting out of this Agreement to Arbitrate has no effect on any previous, other, or future arbitration agreements that you may have with us.

My bet is that public policy importance of Kaiser is in the RICO claim; all the other claims seem to be an effort to satisfy the “RICO predicates,” although that’s just my view. Given that StubHub is trying to get an IPO on file, the last thing that they want is a public trial on racketeering.

Opt out clauses in arbitration agreements provides users with the option to decline the arbitration agreement within a specified period, allowing them to retain their right to pursue legal action in court. Typically, an opt out requires users to take specific actions within a certain timeframe to opt out. If users do not opt out within the given period, they are deemed to have accepted the arbitration agreement and are bound by its terms. This is what happened in Kaiser.

Of course, there is a timing issue with any opt-out clause. Before the consumer has reason to suspect that they are dealing with a racketeer, they must click through the terms of service including the arbitration clause and very likely do not understand that they are giving up valuable rights to protect themselves. More importantly, they are unlikely to understand that that the later-identified racketeer is using lawfare to protect their potentially actionable, if not criminal, operation.

If you are thinking that it does not seem fair for a private arbitrator to be making decisions about whether a defendant has violated public policy in consumer protection statutes or RICO cases that were never envisioned by legislators to be getting resolved in arbitration, you are not alone.

However unfair the result, it seems unlikely that the judge will overturn herself. What does seem likely is that a state attorney general or even a U.S. Attorney could open a RICO investigation into StubHub. A criminal investigation is unlikely to be subject to arbitration, although I feel confident that StubHub will try. You know, because the Internet.

Since the situs of the fraud was also arguably in the UK at Hotspurs World, and assuming that Hotspurs did not authorize StubHub to sell the fake tickets, it is possible that StubHub’s UK operations could also be investigated under the UK’s Proceeds of Crime Act (POCA). POCA is similar, but not identical, to RICO. POCA has some very interesting provisions such as the National Crime Agency’s ability to serve an “Unexplained Wealth Order” on someone who seems to have gotten rich all of a sudden. I’m not a UK lawyer, but it’s worth considering if a “UWO” just might apply to StubHub’s entire senior management team, who knows. The UK have this great organization called the “Serious Fraud Office” which sounds like it came from Harry Potter, but is very real, I assure you.

Now What?

It appears that the Kaiser lawsuit is going to need to go through the formalities of arbitration under the American Arbitration Association (AAA) before it can land back in Judge Rochon’s court. It is unlikely that we will hear much publicly about the proceeding. For example, the AAA Commercial Arbitration Rules do include provisions for confidentiality, but they do not mandate it for all aspects of the arbitration proceedings. Specifically, Rule R-45 requires the arbitrator to keep all matters relating to the arbitration or an award confidential. However, the rules do not impose a blanket requirement for the parties themselves to maintain confidentiality throughout the entire process unless they otherwise agree, which hopefully they will not.

Note that this all applies to the statutory RICO claim as well as the contract claims. The Gambino Family must be envious.

However, state and federal law enforcement agencies are not bound by Internet company arbitration clauses, at least not yet–the line between Google, Amazon, Facebook and the federal government continues to blur. For example,  New York has its own version of the federal RICO Act called the Enterprise Corruption statute. This law is designed to combat organized crime by targeting the diversified illegal activities that such groups engage in. The statute makes it a Class B felony to participate in an enterprise through a pattern of criminal activity. This would likely require the District Attorney for New York County or the New York State Organized Crime Task Force to open an investigation of StubHub. It is worth noting that 33 states have these “Little RICO” acts, such as the Texas Organized Crime Statute.

Congress may also act to limit the applicability of arbitration clauses generally to exclude civil RICO claims and class action waivers, or at least allow consumer fraud claims to be heard outside of arbitration by state and federal courts. This could be a fix for the obvious due process issues present in Judge Rochon’s ruling that illustrate how a trial judge’s hands are tied absent Congressional action. It seems that this issue is so blatant in the Kaiser case that it’s at least worth a Congressional investigation and also a disclosure as a risk factor in any StubHub IPO prospectus.

Stay tuned, cats and kitties, the plot sickens.

Open the Pod Bay Doors, HAL: Why Eric Schmidt is Insane in his own words

In the GAI, no one can hear you scream. Let’s remember that this man has already stolen world culture–twice. It will be a dark kind of fun watching Schmidt get the World Economic Forum, Lawrence Lessig and Greta Thunberg to do a 180 on climate change. Don’t laugh–if anyone can do it, he can. You watch, the Berkman Center and EFF will lead the charge.

After Universal, TikTok Throws Its Toys Out of the Pram In Concerted Refusal to Deal with Merlin

Here’s some news, and make sure you’re sitting down: Still stinging from its encounter with Universal, TikTok wants its counterparties weak, divided and broke. So naturally TikTok is going after Merlin in TikTok’s latest concerted refusal to deal.

Let’s remember the basic premise behind Merlin, the licensing body that independent labels can opt into at their election. Independent labels as a group have a combined market share that is on par with a major label. I recall hearing this from Alison Wenham back when the Association of Independent Music was founded back in 1999. Joining together, independent labels could be strong, united and claiming their fair share right along side the major labels. (Unclear why this seems to be lost on the publishers.)

So after Mr. Tok got a spanking from Universal, TikTok are definitely not going to put up with resistance from independent labels, assuming TikTok are even in business by the time the dust settles. As Kristin Robinson reports in Billboard:

A TikTok spokesperson says that “TikTok would like to offer all of the world’s music to our users. We are committed to working with the independent sector as well as the major labels and publishers. We know that our community of over a billion music fans value the diversity and richness that independent music brings to our platform. We are committed to entering into direct deals with Merlin members in order to keep their music on TikTok.”

Founded in 2008, Merlin represents 15% of the global recorded music market, and it uses that collective market power to negotiate with digital partners on behalf of its members on a similar footing as the bigger major labels. 

So there you have it: TikTok doesn’t want any lip from independents that might put them on the same footing as the majors anymore than the MIC Coalition wants lip from GMR. The one thing that TikTok cannot say is that it’s more efficient for the company to negotiate separately with independents. This isn’t about efficiency–it’s about stopping a near Universal-level exodus from happening again. And not just stopping it this time, it’s about stopping it forever. 

In other words, crushing the resistance. That option wasn’t available to Mr. Tok when negotiating with Universal but it’s available now.

Of course you know that TikTok intends to hose the independents because the first thing they did before even discussing a potential deal is require the labels sign a nondisclosure agreement (which no doubt is nonnegotiable). Because nothing says transparency like secrecy. And what’s really great is that it’s no problem because nobody in the music business ever talks about their deals.

As Ms. Robinson reports:

Billboard obtained an email TikTok sent out to some Merlin members, stating that the short-form video app “decided not to renew [its] license agreements with Merlin” and that TikTok “may be able to do direct deals” with the labels, provided that they agree to sign a non-disclosure agreement (NDA). “The purpose of the NDA is to enable us to discuss direct licensing agreements with you.” The deadline to sign and return the NDA is Oct. 4. A TikTok spokesperson says, however, that any Merlin label that wishes to stay on TikTok after Oct. 31 can review and sign the TikTok and CapCut agreements anytime before Oct. 25.

Merlin told its members that it is doing “all [it] can to re-engage with TikTok… we have already made it clear to them that we are ready to hold an actual negotiation and address any concerns they may have.”

Actually, the purpose of the NDA is to keep the independent labels quiet under threat of lawsuit from Mr. Tok and his backers like Neil Shen and Sequoia China. TikTok’s feigned support for independent music is about as convincing as an ivory poacher joining PETA.