1:18pm PT by Eriq Gardner
After SiriusXM Success, The Turtles Take on Pandora in $25 Million Lawsuit (Exclusive)
The radio dial — whether it's satellite like SiriusXM, web like Pandora or terrestrial like iHeartMedia — might never be the same.
About a week ago, SiriusXM suffered a crushing courtroom loss to Flo & Eddie of The Turtles, the 1960s band which produced hit songs like "Happy Together," "It Ain't Me Babe" and "She'd Rather Be With Me." Flo & Eddie have been leading the charge against the uncompensated use of their music — and using state-based misappropriation, conversation and unfair competition claims because sound recordings only began falling under federal copyright protection in 1972.
On September 22, U.S. District Judge Philip Gutierrez blessed the theory that in California at least, exclusive ownership of a pre-1972 sound recording includes the right to publicly perform the work. While SiriusXM says it will appeal, citing decades of of settled practice that music users like restaurants and nightclubs don't have to pay for older music, the satcaster won't be the only one in the industry confronting a legal nightmare.
Next up for Flo & Eddie is Pandora, the most popular Internet radio service in the country with more than 200 million registered users. Represented by Harvey Geller and Henry Gradstein at Gradstein & Marzano, the duo filed a proposed class action lawsuit on Thursday.
"Pandora understands that having a vast range and array of music is critical to the success of any music service which is why pre-1972 recordings constitute a significant part of the Music Service," says the lawsuit. "Pandora offers and advertises stations dedicated to pre-1972 recordings, such as '50s Rock n' Roll,' '60s Oldies,' 'Motown,' 'Doo-Wop, '70s Folk,' 'Early Jazz,' 'Standards,' 'Classic Soul,' 'Jam Bands,' and 'Classical Rock.' "
The lawsuit continues by mentioning all the copies being made to populate Pandora's databases in order to stream music to the public.
"Pandora is aware that it does not have any license, right or authority to reproduce, perform, distribute or otherwise exploit via the Music Service any pre-1972 recordings (including The Turtles' Recordings)," alleges the complaint.
While the RIAA is already taking on Pandora over the issue of pre-1972 music, that lawsuit is happening in New York, while this one is filed in California, a place that the plaintiffs no doubt hope to use newly minted precedent on the issue of public performance rights.
Flo & Eddie alleged that damages against SiriusXM would be at least $100 million — representing some calculation of royalties not paid — while this latest action against Pandora seeks at least $25 million. But the money isn't the only point. Not when there are potential other lawsuits forthcoming.
Pandora says that it pays publishing royalties on all spins, including pre-'72 music, which means that it compensates songwriters, but not necessarily performers. It says its platform helps extend the longevity of artists' careers, and perhaps with a nod to the safe harbor provisions of the DMCA and the royalty rates paid by others, adds it would support "the full federalization of Pre-72 sound recordings under a technology-neutral approach that affords libraries, music services and consumers the same rights and responsibilities that are enjoyed with respect to all other sound recordings."