SiriusXM Scores Definitive Victory in Eight-Year Legal Battle Over Pre-1972 Royalties

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The Ninth Circuit Court of Appeals has officially ruled in favor of SiriusXM in its nearly decade-long legal battle over pre-1972 radio royalties, and specifically whether California law compels it to pay public-performance royalties on “oldies” music.

The Ninth Circuit just recently ruled in favor of SiriusXM, overturning a district court’s partial summary judgment in favor of Flo & Eddie. The Turtles founding members Howard Kaylan and Mark Volman established the latter company (which shares its name with their comedy-rock duo) in 1971, and the entity possesses the rights to Turtles hits including “Happy Together” (1967).

Flo & Eddie sued SiriusXM back in 2013, alleging that they were entitled to public-performance royalty payments for the broadcast of pre-1972 tracks under California common law and statutory copyright law. “Relying on California Civil Code Section 980,” the Ninth Circuit summarized, “Flo & Eddie argued that California gives it the ‘exclusive ownership’ of its pre-1972 songs, including the right of public performance, which requires compensation.”

For additional context, the section of California’s Civil Code in question reads, in part: “The author of an original work of authorship consisting of a sound recording initially fixed prior to February 15, 1972, has an exclusive ownership therein until February 15, 2047.”

In brief, the district court that ruled in favor of Flo & Eddie and other plaintiffs – it also bears mentioning that the precise amount of a settlement between the parties depended upon the outcome of appeals in other courts – “gave broad meaning to the phrase ‘exclusive ownership’ and reasoned that it must include ‘right of public performance.’”

The plaintiffs levied similar complaints against SiriusXM in New York and Florida, but an appellate court in the former state “held that New York common law had never recognized a right of public performance for pre-1972 sound recordings.” The Florida Supreme Court issued a similar judgement, and “with these losses in the Second and Eleventh Circuits, Flo & Eddie has nowhere to run but to the Ninth Circuit.”

Now, as initially mentioned, the Ninth Circuit has ruled in favor of SiriusXM, which recently launched a TikTok Radio channel. This latest ruling in the extensive courtroom confrontation makes clear at the outset that the district court defined “exclusive ownership” under California law by looking up and then combining the dictionary meaning of each word, thereby arriving “at a capacious definition” for the term itself.

“Dictionaries and tools of grammatical construction can help determine plain meaning of specific words, but some phrases have a separate or more specialized ‘term of art’ meaning that cannot be stripped away from its historical context or subject matter area,” the Ninth Circuit penned. “In short, literalism is not necessarily textualism.”

And because “exclusive ownership” as used in the California Civil Code “dates to 1872 when the state first adopted it [the Code as well as the term]… the difference between the literal and context-specific definitions of ‘exclusive ownership’ is night and day,” the ruling proceeds. Moreover, as “no court as of 1872 had recognized the right of public performance under any nascent understanding of copyright law…the term ‘exclusive ownership’ almost certainly did not include a right of public performance.

“Rather, ‘exclusive ownership’ referred, and still refers, to the owner’s common law copyright in an unpublished work to reproduce and sell copies of that work,” the text continues, with the California legislature having left the core definition in place throughout the last century and a half. “Sirius does not buy, reproduce, or resell Flo & Eddie’s master records. Nor can it reasonably be seen as competing with Flo & Eddie for the sale of a sound recording performance.”

In conclusion, the ruling states that “common law provides a perpetual copyright for unpublished works, but Congress alone determines the length of a monopoly for published works.” Furthermore, “the lack of a judicially recognized right of public performance across dozens of states underscores that no such right ever existed under the common law.”

Though 2018’s Music Modernization Act established recorded royalties for pre-1972 tracks played on satellite radio – to be sure, a last-minute SiriusXM deal reportedly set the stage for the legislation’s approval – traditional radio stations are still exempt from paying royalties on the recorded side. The long-running battle over terrestrial-radio royalties is showing few signs of slowing down, as lawmakers this summer introduced bipartisan radio-royalty overhaul legislation as well as a competing bill that would leave the existing framework in place.

One Response

  1. JAS

    So Sirius can make money playing these artists music, but don’t have to pay
    anything to them?

    This seems wrong on all fronts. The music business has always found ways to not pay.

    Reply

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