In a significant move that has sent ripples through the music industry, the American Federation of Musicians (AFM) has filed a lawsuit against two of the largest record labels in the world, Universal Music Group (UMG) and Warner Music Group (WMG). The lawsuit, submitted to the U.S. District Court for the Southern District of New York on June 5, 2026, alleges that these major labels have licensed recordings made by AFM members to artificial intelligence (AI) music companies, Suno and Udio, without providing compensation or credit to the musicians.
The AFM’s complaint highlights that UMG and WMG entered into agreements with these AI firms that triggered a “new use” provision in their collective bargaining agreement. This provision mandates that when recorded work is utilized for a new commercial purpose, the musicians involved must be compensated. The union argues that the labels have failed to adhere to this contractual obligation, permitting AI companies to exploit the musicians’ work without due recognition or financial reward.
The lawsuit asserts that UMG and WMG have taken advantage of their position within the music industry, generating substantial revenue from licensing agreements while neglecting to share any of those profits with the session musicians whose talents contributed to the recordings. “While the Defendants protected their own interests and created a significant source of new revenue with the retrospective settlements and prospective licenses, they have refused to compensate the musicians whose work – created with their own instruments and through their talent, creativity, and hard work – is fed into AI machines for profit,” the complaint states.
As part of its legal action, the AFM is seeking unspecified monetary damages and is demanding that the labels disclose which specific recordings were included in the AI training datasets. The union contends that UMG and WMG have licensed extensive portions of their music catalogs to the AI firms for both past and future uses, thereby creating a continuous revenue stream for themselves while sidelining the artists.
This lawsuit follows a series of copyright settlements that UMG and WMG reached with Udio and Suno in late 2025, where they agreed to license their catalogs for the development of new AI music platforms. The AFM, however, emphasizes that these agreements have not benefited the musicians, raising questions about how artists will be compensated in an era increasingly dominated by AI-generated content.
In response to the filing, representatives from UMG and WMG expressed disappointment regarding the AFM’s actions. A spokesperson for UMG stated that the company has been proactive in safeguarding the rights of artists and songwriters in the context of AI, emphasizing their commitment to responsible licensing agreements. Similarly, WMG criticized the AFM’s lawsuit as unproductive and reaffirmed their willingness to continue negotiations to address artists’ concerns.
As the music industry grapples with the implications of AI technology, this lawsuit underscores the need for clear regulations and fair practices regarding artists’ rights and compensation. The outcome of this case could set a precedent for how musicians are treated in an evolving landscape where their creative works are increasingly being utilized by technological advancements.
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