6:41am PT by Eriq Gardner
Record Giants Win $210M Settlement from SiriusXM Over Pre-1972 Music
The Recording Industry Association of America has announced that SiriusXM will be paying for the use of sound recordings created before 1972.
A $210 million settlement with ABKCO Music & Records, Capitol Records, Sony Music Entertainment, UMG Recordings and Warner Music Group resolves a lawsuit filed over the satellite radio giant's performance and reproduction of older songs.
“This is a great step forward for all music creators,” said RIAA CEO Cary Sherman. “Music has tremendous value, whether it was made in 1970 or 2015. We hope others take note of this important agreement and follow Sirius XM’s example.”
The lawsuit came in the aftermath of a class action filed by Flo & Eddie of The Turtles and aimed to use California state misappropriation laws — also called common law copyrights — to win compensation over the use of sound recordings made before such recordings fell under federal copyright protection. For years, record labels accepted publicity and no royalties from terrestrial radio operators, but changes in how music is consumed have changed the dynamic.
SoundExchange, a digital performance rights organization, collects money from SiriusXM, which has excluded from gross revenue calculations performances of pre-1972 recordings.
Sound recording owners have gone to court over the issue in California, New York and Florida, and RIAA members got a big victory on an interpretation of law in October 2014.
The deal provides for a license through the end of 2017, after which SiriusXM will have to negotiate with the record labels going forward. The settlement doesn't end the class action lawsuits led by Flo & Eddie, who have prevailed on summary judgment and await review by the 2nd Circuit Court of Appeals to see if the rulings hold up. The agreement announced today also doesn't deal with if and how the big record labels will share proceeds with its artists.
The announcement of the settlement is a milestone, but leaves plenty of issues left unresolved in the controversy over use and compensation of the public performance of pre-1972 music. The subject has led to calls for new legislation, and in the meantime, will continue to circulate in courts.