A federal judge has approved a 45-day pause in SoundExchange’s $150 million royalty lawsuit against SiriusXM, giving both parties time to pursue a potential out-of-court resolution.
US District Judge Naomi Reice Buchwald of the Southern District of New York signed the stay order on May 23, following a joint request from both sides citing “active and ongoing” settlement negotiations. The move temporarily halts proceedings in a case that has drawn attention for its potential implications on how digital performance royalties are calculated in bundled subscription offerings.
Originally filed in the Eastern District of Virginia, the lawsuit alleges that SiriusXM underreported royalties owed by inflating the value of the webcasting portion of its bundled plans. SoundExchange, the nonprofit responsible for collecting and distributing digital performance royalties, claims more than $150 million is owed in back payments.
SoundExchange CEO Michael Huppe has previously stated that earlier efforts to resolve the dispute privately had failed, leading the group to take legal action. SiriusXM has denied any wrongdoing, noting that it has paid out more than $5 billion to rights holders over the past decade and denied wrongdoing and successfully petitioned to move the case to New York earlier this year, citing that its royalty operations are managed out of its Manhattan headquarters. However, the court rejected the company’s bid to dismiss the case entirely.
In return, the satellite broadcaster is countering, claiming it overpaid during the royalty periods in question and accusing SoundExchange’s auditor, Adeptus Partners, of bias and improper conduct during what it calls a “partisan royalty inspection.” SiriusXM is asking the court to invalidate the audit, declare the firm non-independent, and award damages and legal fees.
The stay, while temporary, outlines a conditional roadmap: If a resolution is reached within the 45-day window, the parties are expected to file for dismissal. If talks continue but remain unresolved, they may jointly request an extension. If negotiations stall, the court will resume proceedings.
