Jay Z’s music streaming service Tidal has fired its chief financial officer and chief operating officer, the company confirmed on Tuesday.
The layoffs of CFO Chris Hart and COO Nils Juell came as the company was hit with a $5million lawsuit from Yesh Music Publishing and John Emanuele of duo The American Dollar.
The reasons behind the firings have been kept quiet, but Swedish news site Breakit said on Tuesday that Hart was fired over a dispute on how streaming numbers were being reported.
Norwegian newspaper Dagens Næringsliv reported that Juell had been removed from his position, but the former COO said he was on holiday and declined to comment further.
Tidal confirmed the terminations to Music Week in a statement.
‘Tidal has terminated CFO Chris Hart and COO Nils Juell,’ the statement said. ‘As Tidal has grown into a global operation serving 46 countries we have moved our accounting and operations team to New York while our technology team and key support staff remain in Oslo.’
Hart worked as CFO of Tidal since 2014, and had been at the company since 2012. Juell had been COO since 2007, according to Business Insider.
Tidal is on its third CEO since Jay Z acquired the company last year. It has also lost its chief investment officer, the US marketing manager and the senior vice president of label and artist relations.
Tidal has seen a lot of publicity lately for high-profile exclusives, including Kanye West’s The Life of Pablo.
But last week the company was hit with a lawsuit from Yesh Music Publishing and John Emanuele of duo The American Dollar.
The $5million lawsuit seeks class-action status, alleging that Tidal licensed 118 songs by American Dollar without permission or payment.
It claims that Tidal deliberately miscalculated the number of streams the band’s songs received by tens of millions, according to CNBC.
‘Tidal is up to date on all royalties for the rights to the music stated in Yesh Music LLC and John Emanuele’s claim, and they are misinformed as to who, if anyone, owes royalty payments to them,’ the company said in a statement.
The entire catalogue in question streamed fewer than 13,000 times on Tidal and its predecessor over the past year,’ the statement added.
Tidal said that it has removed all music associated with Yesh Music and Emanuele from its site.
The company has struggled against competitors like Spotify and Pandora, which offer free subscriptions.
But after the release of Kanye West’s new album, subscriptions to the exclusive site soared, though it is unknown if the two are mutually exclusive.
On the first day the album was available, Tidal soared 20 places to become the most downloaded music app in the United States, according to App Annie, which tracks the data.
Tidal earlier also benefitted from streaming exclusives for Beyonce’s politically charged new video Formation and Rihanna’s long-awaited album, although Rihanna has since put her Anti on other platforms.
West has insisted that ‘The Life of Pablo,’ his seventh album, will be available only on Tidal and never available for purchase on Apple’s iTunes, let alone streamed on other services.
Tidal’s list of co-owners also includes Madonna, Rihanna, Kanye West, Alicia Keys, and most recently, T.I.
Since it launched, the service has faced a barrage of criticism.
In 2015, British folk-rock group, Mumford and Sons, said they ‘don’t really care’ if fans don’t pay for their music, adding that the whole idea of the artist-backed enterprise is ‘commercial bulls**t’.
British singer Lily Allen also lashed out at the service following the launch, saying the high price will drive listeners back to pirating music from torrent sites.
The outspoken star took to Twitter to express her concern for the artist-owned streaming platform Tidal: (JZ’s) taken the biggest artists … made them exclusive to TIDAL (am I right in saying this?) … people are going to swarm back to pirate sites in droves,’ she posted.
‘… up and coming (not yet millionaire) artists are going to suffer as a result.’
The singer also took aim at the high audio quality offered by Tidal, suggesting many music fans don’t have the top-end equipment to hear the difference.
It was also revealed late last year that the streaming website would be producing its own original content, including the second season of a Brooklyn street-life drama Money & Violence, which was released in January.
Source: Daily Mail