More Bad News for Satellite Radio

Judge Rules Against XM in Suit by Record Labels

A judge has ruled against XM Satellite Radio, denying the satcater's motion to dismiss a suit brought by record labels. The suit claims that the "XM + MP3" Inno satellite receivers which allow listeners to store songs from broadcasts infringe on the labels' rights to the recordings. XM claims that the Audio Home Recording Act of 1992 protects them, because it allows individuals to record music off the radio for their own usage. U.S. District Judge Deborah Batts did not buy that argument and said that the labels license their music to XM only for airplay. She added that by allowing listeners to store songs heard on the satcaster, XM is acting as both as a broadcaster and a music distributor, when it is only licensed to be the former.

Judge Batts also did not buy XM's comparison of its new technology to a cassette deck recorder, stating, "It is manifestly apparent that the use of a radio-cassette player to record songs played over free radio does not threaten the market for copyrighted works as does the use of a recorder which stores songs from private radio broadcasts on a subscription fee basis." [FMQB]