RadioandMusic
| 19 Nov 2017
Pandora close to paying out $90m over pre-1972 recordings

MUMBAI: A year long legal battle between online radio giant- Pandora, and major recording labels may finally soon see a conclusion. Reports suggest that Pandora could shell out $90m as settlement for use of pre-1972 recordings without permission from the labels. Three record labels – Sony, Universal and Warner – along with ABKCO, an independent label, filed a lawsuit against the online radio in the New York State Supreme Court in Manhattan, last year.

The nature of the settlement expects Pandora to pay $60 million for the usage of recordings through 2015, and another $30 million to cover through 2016. The company could approve the settlement deal by 20 October, the NY Post has reported.

Should the settlement go through, Pandora will become the second major radio outlet to settle with right holders. Earlier this year, SiriusXM paid $210 million to major labels for violation of the copyright law formed in 1972. However, both online radios claim that the federal master recording copyright law was not formed until 1972, and therefore, they do not have to pay for pre-1972 recordings. Recording labels, on the other hand, argue that Pandora is entitled to pay the dues because of individual state copyright laws.

The labels followed the path taken by American rock band The Turtles, which filed a $100 million lawsuit against SiriusXM in 2013, which the band finally won in June this year. The Turtles, who own their masters, also sued Pandora for royalty payments, citing state laws in California and New York. Pandora tried to move the suit of the court, but Judge Philip Gutierrez, (the same judge who ruled in favour of the band against Sirius XM) denied the company’s motion.

Pandora released a statement last year saying that it was ‘confident in its legal position and looks forward to a quick resolution of this matter’. However, Pandora spokeswoman, yesterday, said, “We don’t comment on rumour or speculation.”

Pandora, the largest online radio outlet, has over 250 million users, with 1.77 billion hours of music played each month. Some sources report the settlement fee could even surpass $120 million. Regardless of the amount, this lawsuit could fundamentally change how labels and artists generate revenue.