On Thursday, Sony, Warner Bros, and Universal filed a lawsuit in New York State Supreme Court in Manhattan against Pandora, claiming that the streaming music service is using recordings of older songs without permission.
In their lawsuit, the Big Three music companies argue that Pandora is violating New York State's own common-law copyright protections by using recordings of older songs without permission. Thus these companies believe that Pandora must not only have permission to play those songs, but to cough up the appropriate licensing fees.
"This case presents a classic attempt by Pandora to reap where it has not sown," the labels say in the suit. "Pandora appropriates plaintiffs' valuable and unique property, violates New York law, and engages in common law copyright infringement and misappropriation and unfair competition."
As explained by the New York Times, federal copyright law dictates that online and satellite radio must get licenses to use recordings that were made after the February 15, 1972 date. Payments are made in the "hundreds of millions" to SoundExchange, a branch of the RIAA. Songs that were recorded before 1972 aren't covered under federal copyright protection, but instead are covered by "a patchwork" of state laws.
Pandora has more than 70 million regular users, followed by Sirius XM, which has around 26 million subscribers. These two popular music listening services contributed to most of the $656 million in performance royalties collected by SoundExchange in 2013, the paper reports.
Currently, it's unclear if Pandora, along with Sirius XM, will be made to license the older music. As the New York Times points out, the current wave of lawsuits reflects the current mess the music industry is in, and could shape how the industry charges for music playback.
"Just because Buddy and the other '50s musicians recorded songs before 1972 doesn't mean their songs have no value," said the widow of Buddy Holly via the RIAA. "These companies' failure to pay the rock 'n' roll pioneers is an injustice and it needs to change."