Warner Music ends AI fight with Suno as SAP faces trade-secret suit
Two moves, one message for legal teams: AI disputes are shifting from "fight" to "framework." Warner Music Group settled its copyright case with Suno and turned it into a licensing partnership. On the same day, o9 Solutions sued SAP in Dallas federal court, alleging theft of supply-chain trade secrets by three former o9 executives now at SAP.
Warner-Suno: from lawsuit to licensing model
The settlement closes a case that began when major labels sued Suno and Udio for using copyrighted works without compensation. As part of the deal, Suno dropped its fair-use defense and agreed to replace its current platform with licensed AI models in 2026.
Distribution will be pay-gated. Users who want to download tracks or post them to streaming services will need paid accounts, and they'll face monthly download caps. Free-tier users can listen and share inside Suno, but not export.
Suno also acquired Songkick from Warner Music for an undisclosed amount, expanding into artist-fan engagement. The company recently raised $250 million at a $2.45 billion valuation and says nearly 100 million users have created music on its platform in the last two years.
Warner has now settled with both Suno and Udio; Udio also settled with Universal Music. This is a clear pivot from blanket litigation to structured licensing and monetization.
Legal takeaways for music and AI counsel
- Fair use retreat: Dropping the defense signals limited appetite to test training-data fair use for music in court right now. Expect more private licensing over precedent.
- Consent + compensation baked in: Licensed AI models by 2026 points to rights-clearance at training and output stages. Update policies on datasets, source provenance, and model outputs.
- Distribution controls matter: Paywalls and caps help allocate value and reduce leakage. Contracts with users and distributors should mirror these controls and include audit and takedown terms.
- M&A adds leverage: The Songkick acquisition blends creation with live engagement. Watch integration risks: data sharing, consumer consents, antitrust thresholds, and exclusivity provisions.
- Indemnities and warranties: Renegotiate vendor terms to cover training data, artist likeness, and sampling. Require traceability, content flags, and prompt takedown obligations.
- Policy watch: Keep an eye on agency guidance around AI and copyright, including limits on registering AI-assisted works and disclosure duties. See the U.S. Copyright Office's AI resource hub here.
o9 Solutions v. SAP: alleged trade-secret campaign
o9 Solutions sued SAP in Dallas federal court, alleging three former o9 executives downloaded over 20,000 confidential supply-chain files before joining SAP. The named individuals are Stephan de Barse (now president of SAP's global business suite), Sean Zonneveld (global CRO for procurement), and Stijn-Pieter van Houten (chief product officer for supply chain management planning).
Backed by KKR and General Atlantic and valued at $3.7 billion in 2023, o9 claims SAP targeted its proprietary technology amid customer attrition and then reworked SAP's software to mirror o9's. SAP stated it respects others' IP and will respond through the legal process.
What in-house teams should expect
- Statutory posture: A federal filing like this often travels with the Defend Trade Secrets Act; state law claims (e.g., Texas UTSA), breach of duty, and contract claims are common companions. DTSA text: Congress.gov.
- Early relief risk: TRO/preliminary injunction, sequestration of devices, expedited discovery, and custody of code/artifacts are all in play. Preserve broadly and prepare for forensic protocols.
- Hiring exposure: High-level lateral moves increase risk of "inevitable disclosure" arguments. Use clean-room development plans, written prohibitions on prior-employer materials, and targeted role scoping.
- Damages and fees: If willful misappropriation is proven, enhanced damages and attorneys' fees are possible. Model your financial exposure early; this shapes settlement options.
Action checklist for legal teams
- Music/AI platforms: Inventory training data sources, confirm licenses, implement output filters, and standardize artist consent flows. Add provenance logs and watermarking/trace solutions to support disputes and takedowns.
- Labels and publishers: Update licensing templates for AI inputs/outputs, streaming distribution, and caps. Tighten audit rights and reporting cadence with AI vendors and distributors.
- Enterprise hiring: Strengthen pre-clearance for senior hires. Require written attestations, device returns, and data-wipe confirmations. Document a clean-room plan before day one.
- Offboarding controls: Auto-revoke access, capture exit logs, and perform targeted forensic imaging where risk is high. Track cloud exports and personal email forwarding.
- Incident readiness: Maintain a playbook for trade-secret disputes: legal hold triggers, custodian lists, forensic partners, and draft papers for TRO/hearing timelines.
What to watch next
- The specifics of Suno's licensed model in 2026 and how download caps translate into revenue shares for rights holders.
- Any regulatory or collective licensing moves that standardize AI training and distribution in music.
- Early motions in o9 v. SAP: bids for injunctive relief, scope of expedited discovery, and any court-ordered code or document escrow.
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