For the third time in as many months, SiriusXM has been rocked with a court ruling over the issue of pre-1972 sound recordings. This time, a ruling comes in New York, a sign that the satellite radio broadcaster's liability won't be limited to California — the scene of earlier losses — plus bad news for Pandora and terrestrial radio operators.
As we've been covering,SiriusXM has been fighting lawsuits from Flo & Eddie of The Turtles as well as major record labels for publicly performing sound recordings without authorization and compensation.
The key to these disputes is understanding that sound recordings only began falling under federal copyright protection in 1972. State laws protect sound recordings authored before that year, but until these new lawsuits were brought, it wasn't particularly clear whether ownership of a pre-72 sound recording included the exclusive right to publicly perform the song.
In September, a California judge declared the Turtles the victors in the case there. In October, a different California judge ruled that the plaintiff record labels had the correct interpretation of the law.
These have been shocking developments to some broadcasters. For example, two weeks ago, the Consumer Federation of America and the Prometheus Radio Project submitted an amicus brief in support of an interlocutory appeal by SiriusXM. Meanwhile, Pandora has already been targeted in both California and New York.
On Friday, New York federal judge Colleen McMahon became the latest to weigh in on the legal firestorm by denying SiriusXM's motion for summary judgment in a second lawsuit brought by Flo & Eddie.
She shrugs off SiriusXM's principal argument that no public performance rights exist because New York case law contains no discussion of it. She acknowledges the "accepted fact of life in the broadcast industry for the last century" that nobody was paying royalties for public performance. Then adds: "But acquiescence by participants in the recording industry in a status quo where recording artists and producers were not paid royalties while songwriters were does not show that they lacked an enforceable right under the common law — only that they failed to act on it."
According to the judge, there is a stronger argument that the years of judicial silence "implies exactly the opposite of what Sirius contends — not that common law copyright in sound recordings carries no right of public performance, but rather that common law copyright in sound recordings comes with the entire bundle of rights that holders of copyright in other works enjoy."
She then confirms it does, and maybe goes even further than either of the California judges did by finding that Sirius reproduced Turtles recordings in all sorts of ways, through databases, play-out servers and buffer copies, though she hedges by saying that some of these copes might not qualify as infringing reproductions.
Nevertheless, she rules out fair use, declares that SiriusXM has engaged in unfair competition and rejects a defense built upon the interstate commerce clause.
It won't be surprising to see SiriusXM — which has been recruiting new legal firepower to its side like Hollywood Reporter power lawyer Daniel Petrocelli — to attempt an immediate appeal on this ruling as well. As that happens, all sorts of other music users — terrestrial radio operators, digital streamers and maybe even your local pub — are going to be faced with some big decisions about whether or not to continue playing pre-72 music without a license from the owners of sound recordings.
This article first appeared on THR.com.