Judge Hands SiriusXM A Crushing Loss

Members of rock band the Turtles scored a major win in their $100 million royalties class action against SiriusXM Radio on Monday when a California federal judge ruled Sirius infringed copyrights by broadcasting songs recorded before 1972 without paying royalties for performance of the recording.

U.S. District Judge Philip Gutierrez determined Sirius is liable for infringement on a key issue: the public performance of songs recorded before 1972 — songs that aren’t covered by federal copyright law.

Sirius up til now has not paid royalties for any music prior to 1972, claiming that it was exempt by law. This means for the Turtles, for example, that every time “Happy Together” or “Elenore” were heard on a Sirius channel, it was free.

And this pertains just about to every track heard on Sirius that was a hit before February 1972, from Elvis to the Beatles to most of Motown, etc.

Judge Philip Guitierrez ruling is certain to cause tidal waves through the radio and music industries today.

This may be the line from the judge’s decree that echoes all over the place: “On undisputed facts, Sirius XM publicly performs Flo & Eddie’s sound recordings without authorization to do so…At minimum, Flo & Eddie was injured by Sirius XM’s conduct in the form of foregone licensing or royalty payments that Sirius XM should have paid before publicly performing Flo & Eddie’s recordings.”

The Los Angeles ruling gives the music industry and its pre-1972 legal theory a boost, according to gigaom.com.  For SiriusXM and for consumers of digital radio, however, the ruling could lead to higher prices — or less music if the radio stations decide to simply play fewer songs from the 1940s, 50s and 60s.

While the music industry has framed the disputes with SiriusXM and Pandora as a sentimental call to compensate beloved musicians, the issue is actually more complicated than that. Under copyright’s convoluted licensing system, all radio stations pay songwriters when they perform their songs — meaning that artists and their heirs are already being paid for Turtles songs, and for songs dating back all the way to the 1940s.

The treatment of recordings is different, however, and has required digital radio services to pay ever-increasing royalty rates even as AM/FM radio stations remain exempt from the royalties altogether.

SiriusXM did not immediately reply to an email request for comment, so it it is not immediately clear if the company will appeal the decision, or if it will cease playing the older recordings.

Here is a copy of the ruling, which does not specify what the damages will be, but does find SiriusXM liable for conversion, misappropriation and breach of California’s unfair competition law.

Sirius 1972 Ruling