SAN FRANCISCO (CN) — Kanye West tricked 2 million people into signing up for Jay-Z's struggling music-streaming service, Tidal, by falsely claiming that Kanye's album "The Life of Pablo" would be released exclusively on Tidal, a class action claims in Federal Court.
Lead plaintiff Justin Baker-Rhett sued West and Jay-Z's company, S. Carter Enterprises, on Monday. He claims West and Tidal used false advertising to coax him and 2 million others into handing over their private information and credit card numbers to the streaming service.
Jay-Z acquired the Swedish company Aspiro, which owns Tidal, for $56 million in March 2015 with plans to launch the first artist-owned streaming service to compete with other music streaming giants such as Spotify and Pandora.
In February 2015, Jay-Z held a secret meeting with superstars - including Beyonce, Madonna, Rihanna, Jack White, Usher and Kanye West — offering them 3 percent stakes in his company in exchange for their creating exclusive content for the service, according to news reports cited in the complaint.
At the time Jay-Z was acquiring the streaming service, Aspiro's board of directors acknowledged the company lacked the money to survive beyond 12 months, according to a February 2015 board report.
By early 2016, Tidal was "teetering on the brink of collapse," and West announced on Twitter that had $53 million in personal debt.
With financial woes abounding, West tweeted to his 22 million followers in February that his new album, "The Life of Pablo," one of the most anticipated of 2016, would be released exclusively on Tidal.
"My album will never never never be on Apple. And it will never be for sale ... You can only get it on Tidal," West wrote in a tweet on Feb. 15.
That announcement, and similar tweets from Tidal, helped the streaming triple its subscriber base from 1 million to 3 million users in just over a month, according to the lawsuit.
Each new subscriber, including those who signed up for a free trial membership, had to provide a credit card number, which would be charged at the end of the trial period.
"Consumers were uniformly tricked into handing over their private data and credit card information by a singular mistruth," the 26-page complaint states.
"The Life of Pablo" was streamed 250 million times in the first 10 days after it was released on Feb. 14, Tidal told The New York Times in March.
But after about six weeks, West reneged on his promise and began selling the album on his personal website and making it available to Tidal's biggest competitors, including Apple Music and Spotify.
"In reality, neither Mr. West nor SCE ever intended 'The Life of Pablo' to run exclusively on the Tidal platform," the complaint states. "To the contrary, they — knowing that Tidal was in trouble but not wanting to invest their own money to save the company — chose to fraudulently induce millions of American consumers into paying for Tidal's rescue."
Tidal not only benefited from users' subscription fees but from their personal data, including user habits, demographics and browsing history, the lawsuit claims.
"By increasing their user base multiple times over, Tidal is able to create valuable usage information to aid them in better monetizing their site as well sharing with or selling that information to third parties (such as record labels, artists on its platform, and other media companies)," the complaint states.
Baker-Rhett says he would not have signed up for Tidal or paid the $9.99 subscription fee had he known "The Life of Pablo" would be made available elsewhere.
He seeks class certification, damages for false advertising, unfair competition, fraud and unjust enrichment, restitution, and an order directing Tidal to delete all class members' personal data, cancel any outstanding fees and to stop using their personal information to make money.
He is represented by Todd Logan with Edelson PC in San Francisco.
S. Carter Enterprises and Tidal's parent company, Aspiro, did not immediately return phone calls and emails seeking comment Monday.
Neither Kanye West nor a representative for him could be reached for comment.
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