SiriusXM Beats SoundExchange’s Unpaid Royalties Suit

A federal judge has denied SoundExchange the opportunity to sue SiriusXM (SXM) for unpaid royalties, ruling it doesn’t have the statutory authority to sue.

The fine print:

• In August 2023, SoundExchange sued SXM, alleging it had failed to pay millions in royalties.

• In October 2024 SXM sought dismissal because SoundExchange has “no private right of action under the federal statute [Section 114 of the Copyright Act] it seeks to enforce.”

• Judge Naomi Reice Buchwald agreed, stating it’s “undisputed that Section 114 lacks an explicit provision extending SoundExchange a right of action or the power to otherwise bring an action to litigate a royalty dispute.”

The response:

• As per Digital Music News, the judge’s ruling could have far reaching ramifications on SoundExchange’s “broader enforcement capabilities.”

• The PRO has responded by stating that Judge Buchwald’s interpretation “is entirely wrong on the law.”

• It adds: “Despite this unfortunate and incorrect ruling, it is an established and long-accepted fact that SoundExchange has the right to sue negligent providers to compel compliance and payment of mandated royalty fees. In fact, SiriusXM has previously conceded this exact point when SoundExchange has brought claims against SiriusXM.”

• The PRO is currently considering its options, “including appeal and potentially filing actions in state courts to ensure the company’s continuing ability to collect all digital performance royalties owed to its constituents for the use of their recordings under the law.”