AFM Drops Warner Music Parent From AI Suit, but Warner Records Pay Claims Continue

The American Federation of Musicians has removed Warner Music Group Corp. from its lawsuit over AI recording licenses, but the fight over musician compensation remains alive. The union’s amended complaint now targets Warner Records and Atlantic in a dispute over whether recordings licensed to AI companies trigger duties under an existing labor agreement.

AFM voluntarily dismissed its claims against Warner Music Group Corp. in New York federal court. The dismissal applies only to the parent company and was entered without prejudice. In late July, AFM amended its complaint to substitute Warner Records for Warner Music Group Corp.; AFM counsel has confirmed the broader lawsuit remains active.

The case began with AFM’s allegation that Warner and Universal licensed performers’ sound recordings to AI companies without informing or compensating union members. It centers on the collective bargaining agreement’s new use provision, a contract term the parties dispute in the context of AI licensing.

AFM’s position is that AI licensing revenue from Warner Music and Universal Music is covered by the labor agreement and should be shared with its musicians. The lawsuit therefore is not only about whether labels can make AI licensing arrangements. It asks whether those arrangements create payment obligations to the musicians whose performances appear in the licensed recordings.

Warner Music Group Corp. contested its place in the case on corporate and contractual grounds. It argued that the parent did not sign the AFM labor agreement, did not sue Suno or Udio, and did not license either AI platform. That argument focused on the identity of the defendant, while AFM’s amended complaint shifted the Warner claims to the Warner Records label entity.

Digital Music News reported that Warner Music has deals with Suno and Udio. But the continuing litigation names Warner Records and Atlantic, not Warner Music Group Corp. The entity substitution matters because the remaining contract claims will proceed against the companies AFM now identifies as the relevant Warner defendants.

The dismissal filing gave no reason for removing Warner Music Group Corp. and did not resolve the remaining claims. The live question is whether the new use provision reaches revenue from AI licenses and, if it does, whether AFM musicians are entitled to a share.