Pandora Media Inc. made announcement on Thursday that it will be paying a huge amount of about $90 million in order to settle a lawsuit with five record labels. These record labels accuse the music streaming service for cheating them.
Apart from the amount of the settlement, no other details regarding the deal have been disclosed by Pandora. The labels to which the online music streaming service cheated on include Sony Music Entertainment, UMG Recordings, Warner Music Group, Capitol Records and ABKCO Music & Records.
The deal settles the dispute between the music industry and broadcasters over the right to play songs recorded before February 15, 1972.It has been said that the federal copyright law doesn’t cover those songs, and since then, the music industry has been filing lawsuits hoping to expand its royalty rights.
Previously in June 2015, the music companies settled a similar lawsuit against satellite radio provider Sirius XM Holdings Inc (SIRI.O) for $210 million. The record companies filed a lawsuit against Pandora in April, 2014 in New York state court in Manhattan.
The lawsuit clearly demanded to put a halt on Pandora's massive and continuing unauthorized commercial exploitation of older songs. The lawsuit also said that the music of those companies included some of the most legendary artists including the Beatles, the Rolling Stones, the Grateful Dead, Bob Dylan and Elvis Presley.
Pandora's chief executive officer, Brian McAndrews, said, “We pursued this settlement in order to move the conversation forward and continue to foster a better, collaborative relationship with the labels”.
On the other hand, the Recording Industry Association of America Chairman Cary Sherman called the settlement an important milestone and a big victory for the entire music community.