Exhibit 04 · The Streaming Economy Record
On April 29, 2018, an independent Baltimore artist's company filed a ten-count federal lawsuit that mapped, mechanism by mechanism, how streaming fraud worked: who sold the plays, how the fake ones were injected, and where the platform's detection line sat. The first United States criminal prosecution for the same category of conduct came six years later. This is that record, in order.
Presentation note: the fraud allegations in the civil case were never adjudicated and remain allegations. The separate federal criminal case against the same artist is settled record and is stated below, unsoftened. Both records are presented as written; this exhibit adjudicates neither.
04-A
04-B
The campaign
Focus Music Entertainment engages Streamify, LLC, a Houston "music streaming agency" openly selling plays: "All plays are absolutely real and eligible for royalties," per its own marketing quoted by the court. The service orders, June 11 to Sept. 25, 2017, total approximately $21,656, for the song "Get to the Money" on Spotify, tracked through analytics partner Streambeet, Inc.
DOC · Memorandum Opinion, Dec. 5, 2018 (EX-013) · service orders in the court file
The takedown, and the verification
Spotify takes the track down, then reviews it. Its Compliance Team verifies the earlier plays as real, eligible, and organically driven, attributes the latest, fake plays to a different party, apologizes, and says the track can go back up. The message reached Streambeet in an email of Sept. 11, 2017. See panel 04-C.
DOC · Spotify Compliance Team message, quoted in the court record
He tries to tell the story
Arrington emails Music Business Worldwide, attention Tim Ingham: "I have a story about this spotify streams that would break the internet." No reply appears in the record.
DOC · mailbox, two emails, Nov 1, 2017 (document in the project archive)
Counsel engaged
Attorney Paul Gardner sends "Chad - Initial Thoughts." The legal response begins within roughly two months of the collapse.
DOC · mailbox, Gardner correspondence
The ten-count federal suit
Focus Music Entertainment, LLC v. Streamify, LLC, D. Md., ELH-18-1241 (1:18-cv-01241): breach of contract, fraud, breach of fiduciary duty, negligent misrepresentation, unfair competition, and more. The complaint names the machinery: stream spamming, fake and malicious sites, stacked ads, undisclosed rebates, rebrokering.
DOC · complaint and opinion (EX-013)
The other side proposes settlement
One month after filing, Streamify's principal writes directly: "I thought I'd summarize my view on a reasonable settlement agreement... You purchased $22000 worth of plays..." A later email from Arrington to his counsel records a $50,000 settlement offer and his preference to settle rather than litigate in Texas.
DOC · settlement email, May 18, 2018 (document in the project archive) · email to counsel, Oct 2020
The ruling
Judge Ellen L. Hollander denies Streamify's motion and transfers the case to the Southern District of Texas (4:18-cv-04600), because the agreement calls for arbitration in Houston and only a court there can compel it. The fraud claims are never adjudicated on the merits. Per later reporting, the complaint is dropped; per the file, nothing is recovered.
DOC · Memorandum Opinion, Dec 5, 2018 (EX-013)
Direct appeal to the platform
Arrington emails Spotify support and compliance addresses seeking restoration of his artist account, and asks Streambeet to escalate internally. Spotify support replies March 1, 2019.
DOC · mailbox (document in the project archive)
The first US criminal case arrives
USA v. Michael Smith, S.D.N.Y.: the Justice Department's first criminal prosecution for artificially inflated music streaming. Bots, fake accounts, spread-out plays to slip under detection thresholds: the same category of machinery described in the 2018 complaint, now at AI scale.
DOC · DOJ SDNY press release, Sept. 4, 2024, and indictment
Guilty plea, $8,091,843.64 forfeiture
Smith pleads guilty to one count of conspiracy to commit wire fraud before Judge John G. Koeltl and agrees to forfeit $8,091,843.64. Sentencing was scheduled for July 29, 2026. The category the 2018 complaint described is now, officially, a federal crime with a conviction.
DOC · DOJ SDNY press release, Mar 19, 2026
04-C
"Upon verifying your artist's track, we found the plays to be real and eligible, as they were all driven organically as verified by the stats. However, the track's latest plays were found to be fake, and these plays were driven in just a few days by a different party which was not Streambeet. We would like to apologize for taking down the track."
Spotify Compliance Team message, forwarded in an email of Sept. 11, 2017 and quoted in the Memorandum Opinion, Focus Music Entm't, LLC v. Streamify, LLC (D. Md. Dec. 5, 2018). Full text in EX-013.
Per the same message, Spotify's fraud detection team takes down, to verify, the tracks of "mainly non mainstream artists" getting "between 3,000 – 10,000 streams per day." The detection line for independents, stated by the platform itself, preserved in a federal court file.
04-D
The 2018 civil complaint · one artist, D. Md.
The 2024 criminal case · first of its kind, S.D.N.Y.
Same category of machinery, six years apart. The left column was filed by an independent artist's two-person legal effort in 2018 and never adjudicated. The right column took the FBI, the Southern District of New York, and the Mechanical Licensing Collective. This exhibit does not claim the cases are legally equivalent; it shows that the map preceded the prosecution.
04-E
His company contracted with an agency marketing plays that were "absolutely real and eligible for royalties," sued on ten counts when it alleged the plays were fraudulent, and Spotify's own team verified his plays as organically driven.
"Streamify sat idly by [as] thousands of Focus' dollars were squandered on nonexistent, nonviewable, and/or fraudulent music streaming." · the Complaint, as quoted by the court
In a separate federal case, Arrington pleaded guilty to one count of wire fraud conspiracy: more than $4.1 million in unauthorized charges on his employer's card, including promotional services to increase online streaming of his songs. Thirty months, restitution of $4,142,435.31.
"Promotional services to increase online streaming of his songs... 'likes,' 'followers,' 'tags,' and 'views.'" · DOJ sentencing release, May 5, 2021
Both of these are true at the same time. A serious record shows both, which is why this one does. What the reader does with that is the reader's own verdict.
SOURCES: Focus Music Entm't, LLC v. Streamify, LLC, ELH-18-1241 (D. Md.), Memorandum Opinion, Dec. 5, 2018, and docket (transferred, S.D. Tex. 4:18-cv-04600) · mailbox records of chadmmp@gmail.com as logged in the project evidence file · USA v. Arrington, D. Md. (DOJ press releases, plea and sentencing) · USA v. Michael Smith, S.D.N.Y. 24-cr-504 (DOJ press releases Sept. 4, 2024 and Mar. 19, 2026) · Vice, "Chad Focus Wanted to Be a Rap Mogul" · Civil fraud allegations were never adjudicated; settlements and pleas are labelled as what they are. Read the documents ›