SoundExchange moves to dismiss all of Sirius XM’s claims

Sound Exchange has filed a motion to dismiss all counts of Sirius XM’s antitrust complaint. Sirius XM alleged that SoundExchange and A2IM, non-profits that collect and distribute royalties to rights holders, have conspired and interfered with Sirius XM’s ability to deal directly with record labels. Contracting with labels would allow Sirius XM to offer true On Demand streaming music services, since the current regime of statutory licenses limits how often songs can be played.

In its memo in support of the motion, SoundExchange claims that Sirius is using the lawsuit as a “second forum in which to re-litigate the last rate-setting proceeding, and to preempt and undermine the currently pending one” before the federal Copyright Royalty Board. SoundExchange argues that Congress has exempted it and record companies from antitrust litigation when it comes to negotiating terms and services subject to the statutory license. Furthermore, SoundExchange does not have the ability to control prices or output, because its market position is limited by statute.

SoundExchange also points out that record deals have turned down Sirius XM’s offers not because of a conspiracy, but because they were priced at rates lower than those under the statutory license, while requiring the labels to give up more rights.

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Related content: A Competitive Analysis of the Proposed XM-Sirius Satellite Radio Merger

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