Turtles Class Action Is Stayed To Give Sirius XM Chance to Appeal

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By Anandashankar Mazumdar

June 9 — A California litigation piece of ongoing battles between the holders of rights in the Turtles' 1960s hit records and the operator of Sirius XM satellite radio should be stayed, the U.S. District Court for the Central District of California ruled June 8.

The court granted the stay after finding that the U.S. Court of Appeals for the Ninth Circuit has not expressly set forth a rule regarding whether a plaintiff can get a class certified after it has already won a judgment.

Sirius XM Playing Pre-1972 Records Without Authorization 

The Turtles were a 1960s pop music group that had several hits, notably “Happy Together.” The Turtles' founders transferred their rights in the recordings to an entity called Flo & Eddie Inc.

Flo & Eddie brought an action against Sirius XM Radio Inc, the operator of the Sirius XM satellite radio service, alleging that its use of Turtles recordings without paying royalties was a violation of Cal. Civ. Code §980(a)(2), which states that the author of an original sound recording made before Feb. 15, 1972, has exclusive ownership.

Pre-1972 sound recordings are not protected under the federal Copyright Act of 1976 and have thus far been subject to protection under state laws.

Sirius XM argued that because the recordings were not subject to the Copyright Act, that they had no obligation to seek authorization to use them or to pay royalties.

In September, the California court ruled that Sirius XM was liable for broadcasting and streaming the Turtles' recordings.

This was followed by a ruling in January, which said that if Flo & Eddie wanted to go it alone, then it would win summary judgment on the question of liability. But Flo & Eddie chose instead to try to convert the action to a class action.

On May 28, the court certified the class proposed by Flo & Eddie.

More Actions Underway Across the Country 

The Turtles are also pursuing similar claims against Pandora Media Inc., the operator of the Pandora Internet music streaming service.

In February, the district court rejected an attempt by Pandora to get the complaint thrown out based on the argument that Flo & Eddie's legal action was an attempt to suppress Pandora's free speech rights.

Flo & Eddie has also sued Sirius XM in New York and the U.S. Court of Appeals for the Second Circuit has given Sirius XM leave to appeal a ruling by the district court that the use of pre-1972 sound recordings are subject to royalties under New York state law.

Stay Granted to Resolve ‘Serious Legal Issue.'

Back in California, Sirius XM submitted an ex parte application to stay the proceeding in the Central District of California while it sought review of the class certification by the U.S. Court of Appeals for the Ninth Circuit.

The district court granted the stay after determining that Sirius XM had raised “a serious legal issue warranting review by the Ninth Circuit.”

This question was whether, under Ninth Circuit jurisprudence, a court may certify a class action after issuing a judgment in favor of the plaintiff.

The appeals court has not addressed this issue, the district court said, and thus, this was an unsettled question that should be resolved.

The court's ruling was issued by Judge Philip S. Gutierrez.

Flo & Eddie Inc. was represented by Gradstein & Marzano P.C., Los Angeles. Sirius XM was represented by O'Melveny & Myers LLP, Los Angeles.

To contact the reporter on this story: Anandashankar Mazumdar in Washington at amazumdar@bna.com

To contact the editor responsible for this story: Tony Dutra in Washington at adutra@bna.com

Text is available at: http://www.bloomberglaw.com/public/document/Flo__Eddie_Inc_v_Sirius_XM_Radio_Inc_et_al_Docket_No_213cv05693_C/6