Business News Labels & Publishers Legal

New dispute over Flo & Eddie’s settlement with Sirius following New York ruling

By | Published on Monday 30 January 2017

Flo & Eddie

Those paying attention to such things may remember that one-time Turtles Flo & Eddie last November reached a settlement with US satellite broadcaster Sirius XM over its playing of pre-1972 sound recordings without licence. There had been much debate over whether or not the media firm needed to pay artists and labels royalties when they played tracks that pre-dated 1972, because of various complexities around American copyright rules for sound recordings.

Flo & Eddie sued Sirius in three states over the issue, winning in California, the victory from which stemmed the out-of-court settlement on damages. That settlement was somewhat complicated, because the damages, future royalties and legal fees to be paid by the broadcaster to Flo & Eddie and other heritage acts linked to what had become a class action were all reliant on the outcome of ongoing legal action on the same issue in other states. The package had the potential to reach $99 million.

A few weeks after that settlement was reached, just before Christmas, appeal judges in New York State seemed to rule in favour of Sirius after considering whether royalties were due on pre-1972 catalogue there. But, it seems, the two sides are now arguing over what precisely those appeal judges ruled on, and what impact that should have on the pre-agreed settlement package.

According to the Hollywood Reporter, lawyers for Flo & Eddie claim in a new filing that: “The New York Court Of Appeals answer to the certified question regarding New York copyright law [and performing rights] was ‘no’, but that court did not resolve the broader issue of whether Sirius XM’s public performances of pre-1972 recordings can give rise to liability under New York law. Because there is an open question under New York law as to whether Sirius XM was ‘entitled’ to publicly perform their recordings, plaintiffs by definition ‘prevailed’ and are entitled to additional relief under the terms of the Settlement Agreement”.

Not so, says Sirus, whose lawyer writes: “Class counsel has taken the remarkable position that Flo & Eddie prevailed on the performance right issue in the New York Court Of Appeals – meaning the royalty rate will not be reduced, Sirius XM is required to pay class members an additional $5 million, and class counsel is entitled to increased fees. This position is indefensible and reflects an attempt to rewrite and repudiate the stipulation, in violation of its plain terms and the parties’ extensively documented negotiations”.

So that’s all fun. The court overseeing the case, which has only just granted preliminary approval of the Sirius/Flo & Eddie deal, will consider the new dispute over what the New York ruling means for that settlement in March.