Pandora and the Mechanical Licensing Collective are headed toward a jury trial in their battle over streaming royalties after a federal judge declined to rule on competing requests for summary judgment.
In a Wednesday, Sept. 30, order, Judge Eli Richardson of the federal court in Nashville said reviewing the case’s “corpulent” record would require substantial judicial resources. Pandora and the MLC had collectively submitted 263 documents spanning more than 7,000 pages.
Rather than examine that material to determine whether either side should win before trial, Richardson concluded that resolving the contested issues before a jury would be more efficient.
“The court in its discretion finds that it would be more efficient to deal with all contested issues and examine the fulsome factual record at trial rather than expending the (very substantial) judicial resources necessary to dispose of the motions,” the judge wrote.
Richardson also suggested that the sheer size of the case file pointed to factual questions requiring a trial. He reasoned that the more support a summary judgment motion needs, the greater the likelihood that one of its essential components could be unstable.
“If a party has to file thousands of pages and hundreds of documents to explain why there is nothing for a jury to decide — i.e., to explain that, in today’s parlance, ‘there’s nothing to see here’ — then the volume suggests that there is indeed something for the jury to see,” he wrote.
Why the MLC sued Pandora
The MLC, which was created by the Music Modernization Act to apportion mechanical royalties from streaming services, filed its lawsuit against Pandora in 2024. It claims Pandora improperly classified its free service to avoid the higher royalty rates paid by “interactive” platforms.
The dispute turns on the dividing line between interactive services, which let listeners select songs on demand, and noninteractive platforms that operate more like radio. The two categories pay substantially different royalty rates to songwriters and publishers.
Pandora pays interactive royalties for its premium tier, which offers on-demand functionality. But it has long classified Pandora Free as noninteractive because the service largely supplies listeners with a mix of songs based on their preferences.
The MLC alleges that Pandora Free moved into interactive territory by offering “Sponsored Premium Access” sessions. Those sessions allow users to temporarily play particular songs after watching advertisements. The organization characterized Pandora’s conduct as an “unlawful underpayment of royalties.”
Pandora, a SiriusXM unit, denies the allegations and has called the MLC’s position “plainly and unmistakably wrong.” In its summary judgment motion, Pandora accused the organization of “abusing” its authority by pursuing what the company described as unconstitutional claims extending beyond the MLC’s legal role of collecting and distributing mechanical royalties.
Pandora stressed that the Sept. 30 order did not decide which side is right.
“Pandora is committed to compensating songwriters and publishers in accordance with the law, and we remain confident in our position,” the company said.
The MLC, meanwhile, said it “welcomes” the opportunity to continue the case.
“The MLC will continue to pursue this action to enforce Pandora’s royalty payment obligations under the statutory license, supported by the substantial evidence that the MLC has compiled,” a spokesperson said. The spokesperson added that Congress authorized the organization to enforce digital services’ payment obligations under the compulsory blanket license it administers.
A broader royalties backdrop
The Pandora case arrived only months after SiriusXM was separately sued by SoundExchange, which alleged that the company underpaid recorded royalties by manipulating how it bundled satellite and web streaming services.
A judge dismissed the SoundExchange lawsuit last summer after finding that the organization lacked the authority to initiate litigation. That decision, which could affect the music industry’s royalty-enforcement landscape, is now under appeal.
The MLC also brought another high-profile case in 2024, accusing Spotify of combining music and audiobooks in a bundle to unfairly reduce mechanical royalty payments. Its central claims against Spotify were later dismissed, although additional allegations remain in litigation.
Bundling is also a central issue in the Copyright Royalty Board’s ongoing Phono V rate-setting process.
What Happens Next?
No trial date has been scheduled in the Pandora dispute. The two sides could still reach a settlement before a jury hears the case, but both have indicated that they remain committed to their positions.
For now, the judge’s order leaves the underlying royalty questions unresolved: It does not determine the merits of the MLC’s allegations or Pandora’s defenses, and the extensive factual record is set to be examined at trial unless the parties settle first.