Last week SiriusXM Radio Inc. agreed to pay $150 million in unpaid royalties to SoundExchange, Inc., settling all outstanding claims and lawsuits for the period from January 1, 2007 through December 31, 2017. According to a filing with the Securities and Exchange Commission, Sirius XM will pay SoundExchange in a lump sum on or before July 7, 2018, one month after coming to the agreement. SoundExchange is a nonprofit that manages sound recording and music works, including collecting and distributing royalties.  

‘We are happy to resolve this case with SiriusXM. The settlement allows us to distribute additional royalties to SoundExchange’s artists and rights owners while avoiding additional costly litigation,’ said SoundExchange president and CEO Michael Huppe in a June 11 news release.

Billboard says SoundExchange will distribute the royalties collected to the rights owners and artists whose sound recordings were used by SiriusXM between 2007 and 2017.

In other SiriusXM news, the company filed to have a class action lawsuit over lifetime subscriptions moved from New Jersey Superior Court to federal court, reports All Access. The plaintiff, Darlene Vaugh, is suing SiriusXM because her lifetime subscription to the satellite radio service came with hidden restrictions, including a limited number of transfers and a $75 fee per transfer.

We wrote about a related case in September 2016 when Paul Wright of California filed a class action lawsuit against SiriusXM for applying the ‘lifetime’ condition to the lifetime of a receiver or device, such as an automobile, not the lifetime of the subscriber.

‘Defendant systematically advertised and sold its lifetime subscriptions to consumers by leading consumers to believe that such lifetime subscriptions were for the lifetime of the consumer,’ said Wright in the lawsuit, according to Courthouse News Service.

‘However, when consumers have tried to transfer their lifetime subscriptions from one receiver to another or from one automobile to another, defendant has taken the position that the ‘lifetime’ referred to is not the lifetime of the purchasing consumer, but the lifetime of the receiver or automobile,’ Wright said in the suit.

In November 2016, SiriusXM filed a motion to dismiss, and it was granted by the U.S. District Court for the Central District of California in April 2017, reports Insider Radio. The court encouraged Wright to resolve the claim informally through arbitration or in small claims court.

SiriusXM no longer offers the lifetime subscription plan, but it offers a wide range of other subscription plans including these:

• Sirius Select or XM Select Package, $5 a month for 6 months (introductory pricing), 130+ channels of commercial-free music
• XM Mostly Music, $9.99 a month, 65 channels of commercial-free music
• XM Select, $15.99 a month, 130+ channels of premium programming including MLB and NHL games
• XM All Access, $21.99 a month, 140+ channels, all premium programming and SiriusXM Premier Streaming. This is the company’s most popular plan.

SiriusXM Streaming is available as an add-on for music subscribers for $4 a month. A stand-alone subscription for SiriusXM Streaming, which features more than 200 channels with commercial-free music, live sports and on demand content, for $15.99 a month.

Insider Take:

SiriusXM has deep pockets, which make it ripe for lawsuits. In terms of unpaid or underpaid royalties, SiriusXM should be held accountable and made to compensate artists for their work. This settlement is a step in the right direction. Other companies like Spotify have been sued for similar violations. As far as the lifetime subscription claims, while perhaps valid, they don’t seem to rise to the level of a class action lawsuit, as evidenced by the motion for dismissal in a California court. We agree these should be settled one on one.