NASHVILLE — The Pandora Media LLC unit of Sirius XM has been used in a Nashville federal district court on the grounds that it short-changed the Mechanical Licensing Collective (The MLC) on royalty payments.
The MLC also seeks late fees from Pandora, due under a compulsory mechanical blanket license obtained by Pandora to reproduce and distribute musical works in the United States via its consumer music streaming platform.
The MLC seeks corrected usage reporting and associated unpaid royalties and late fees for periods dating back to January 1, 2021, along with an order requiring compliance going forward. A copy of the complaint can be found here.
While Spotify has largely taken over individual music-on-demand streaming from Pandora, the latter’s place in the retail world has grown under Sirius XM ownership. However, the action from the MLC asserts that Pandora underreported and underpaid mechanical royalties due in connection with the operation of its ad-supported music streaming offering marketed as “Pandora Free.”
The action further explains that Pandora Free is an interactive service under the law, meaning that mechanical royalties are due for all streaming activity on the service. According to the MLC, Pandora has only reported a portion of the activity on Pandora Free and “refused” to report and pay mechanical royalties for the rest of the activity.
In a statement, The MLC’s Chief Executive Officer, Kris Ahrend, said, “The MLC has worked closely and tirelessly with blanket licensees to ensure their compliance with the compulsory license terms. Our team repeatedly sought to resolve this issue directly with Pandora, but Pandora has refused to correct their reporting or royalty payments. The MLC is the only entity that has the statutory authority under the Music Modernization Act to take legal steps to enforce the obligations of streaming services. We have brought this action to ensure that our Members receive all the mechanical royalties they are due in connection with the use of their songs by Pandora on the Pandora Free service.”
The MLC was appointed by the Register of Copyrights to administer the blanket license and is the only entity authorized to collect and distribute the license royalties and enforce the license obligations on behalf of rightsholders.
