Law

The Sirius XM lawsuit is an interesting development in the music industry. For years, Sirius XM has been willing to negotiate record deals with artists and music publishers in order to increase their royalty payments. However, in recent years they have become more difficult to negotiate with. For example, a percentage point of royalties has always been set aside for the record label to pay to the artist or band. And, generally the percentage has always been less than 50%. The result has been less incentive for labels to negotiate new deals with their artists, and, as a result, XM has sued many major record labels for doing so.

Now, Sirius has moved forward to bring its lawsuit against RCA Records and Sony BV. It argues that it is entitled to a large amount of performance royalties for its use of pre-recordings in its radio and music channels. Specifically, it is seeking a large percentage of performance royalties for its use of unreleased recordings from artist albums, as well as certain albums that were released between January 1st and July 15th, . That’s a rather large number, and if it is successful, could mean a huge payout to Sirius.

So why has Sirius XM gone after RCA? They argue that because RCA owns the master recordings themselves (as well as the masters of their other music labels), they are barred from negotiating new deals with Sirius because those master recordings are Sirius’s.

However, Sirius states that it had no prior notice that RCA had any pre-1972 recordings. In addition, Sirius says that it has no evidence that anyone has actually infringed RCA’s copyrights. In other words, it claims that it does not own the recordings in question, and therefore no right to ask for compensation based on ownership. So, at first glance, it appears that both sides have a solid argument, but that’s not necessarily the case.

There is one very important difference between this Sirius XM lawsuit and the preceding legal skirmishes over pre-recordings and satellite radio.

The laws governing terrestrial radio are extremely different than those governing satellite radio. While the former governed who could air copyrighted materials, the latter tended to favor mainstream interests, including rap and rock, and even served as an impetus for the invention of rap music in the first place. Thus, when Sirius XM decided to sue RCA, it was acting on behalf of their mainstream interests more than on behalf of their rap music fans.

This is the key difference: royalty payments on Sirius XM content are based on revenue, not revenue share.

This means that Sirius can only pay royalties on actual performance, not on popularity, sales, or other metrics. For example, consider the popular reality series “The Apprentice,” which is hosted by Donald Trump. Each week, Mr. Trump’s competitors all submit videos and audio recordings of their daily discussions with him. If you download “The Apprentice” from the company’s website, you will hear the discussions, as well as hear Donald Trump’s voice. If you listen to the show on Sirius XM, you will hear music from Donald Trump, as well as the voices of the other candidates.

As a result, you are hearing the voice of Donald Trump, but only because he has the rights to perform, not because he wishes to earn revenue from doing so.

Subsequently, there is no sharing of performance royalties with any of the other candidates. Further, in this lawsuit, Sirius XM is merely requesting permission to use copyrighted material on their programming. As previously discussed, the music service’s publishers are typically the ones that actually receive money from the broadcast, not the artists or writers. (ASCAP, the publishers of Performers’ licenses, and RANIA, the publishers of sound recordings, each typically only receive a portion of the recording company’s profit.)

The author of this article is a music copyright lawyer who focuses on entertainment law, copyrights and musical compositions.

You should contact an experienced entertainment lawyer if you have any questions concerning your legal rights and obligations with respect to Sirius XM’s policy on song licensing, performance royalties and copyrights. If you were sued by Sirius XM, it would be wise to consult with a qualified entertainment copyright lawyer before filing a lawsuit, especially if it involved a large sum of money. While there is no doubt that Mr. Trump and Mr. Stern are acting in their individual capacities as owners of the channel, they are nevertheless liable for violations of United States Copyright Law, as well as for breach of their contracts with their services providers.

It is important to point out, however, that although Sirius XM may own the master recording rights to particular songs, they do not retain any performance or music royalties for those songs. Performing a copyrighted work without obtaining a license is a violation of United States Copyright Law, as well as of Federal Trade Commission Rules. In addition, the recorded music publishers typically do not receive any monetary damages for the infringement of their copyrights, despite the fact that they may be liable for actual damages incurred by using someone else’s copyrighted work. This is because the performance royalties are only a percentage of the overall revenue that the station earns from playing the music and not actually paying for the use of the music in question.

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