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Universal Music Group (UMG) is asking a federal judge to dismiss a lawsuit filed by the American Federation of Musicians (AFM), arguing that its collective bargaining agreement does not require compensation for licensing recordings to train generative AI models.
The motion, filed in the U.S. District Court for the Southern District of New York, challenges the union’s claim that UMG violated its labor agreement by licensing sound recordings to AI music platform Udio without payment or credit for union musicians.
Leading the dispute is Article 21(a) of the Sound Recording Labor Agreement (SRLA), which governs compensation when recordings are used in ways not specifically addressed by the contract. The AFM argues that training generative AI systems represents a “new use” under the agreement and therefore requires additional payment to musicians whose performances appear on licensed recordings.
UMG, however, contends that while the contract recognizes the possibility of new uses, it does not establish a payment rate for AI training. Instead, the company argues that any compensation must first be negotiated through a separate agreement. As this currently does not exist, it raises the question of what guards should be set into place.
In a statement, UMG said it remains committed to protecting artists’ interests as artificial intelligence reshapes the music industry, pointing to its AI licensing agreements, legislative advocacy and legal action against unauthorized AI companies. The label also emphasized that it intends to continue working with the AFM through collective bargaining to resolve outstanding issues surrounding AI compensation.
The lawsuit, originally filed in June, also names Warner Music affiliates. The AFM alleges that UMG licensed recordings to Udio, while Warner entered agreements with both Udio and Suno, without compensating musicians represented by the union.
During a July court hearing, attorneys for both sides acknowledged that the current labor agreement does not contain a defined compensation rate for AI-related uses. UMG argued that this omission means payment terms must be negotiated rather than imposed by the court, while the union maintains that the agreement still obligates labels to compensate musicians when recordings are used in new ways.
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