The American Federation of Musicians (AFM) has filed an amended lawsuit against Universal Music Group and Warner Music Group, accusing both major labels of breaching their union contract by licensing members' recordings to AI music generators Suno and Udio without paying or crediting the musicians involved. The case is significant because it tests whether labels can strike lucrative settlements with AI companies over past infringement while sidestepping obligations to the artists whose recordings underpin those deals, raising broader questions about how musicians share in AI-related revenue.

The amended complaint, filed on 24 July in the US District Court for the Southern District of New York, names Warner Records and Atlantic Recording Corp alongside Universal Music Group, after Warner successfully argued its parent company was not a proper defendant. The union's claim rests on Article 21 of the Sound Recording Labor Agreement, which it says requires payment and notification when recordings are put to a "new use" not covered by the deal; the AFM argues that AI training qualifies and covers thousands of tracks. Both majors settled 2024 copyright suits against Suno and Udio in late 2025 and are now seeking dismissal, with Universal calling the union's reading of Article 21 too broad and Warner accusing the AFM of trying to influence negotiations; Judge Edgardo Ramos has allowed the amended complaint to proceed, with dismissal briefs due by 14 August and further briefing through 11 September.