A judge has denied XM Satellite Radio's motion to dismiss a copyright violation lawsuit the recording industry brought against the satcaster last year.
In her decision released Friday, Judge Deborah A. Batts of New York's Southern District said that despite XM's claims to the contrary, it is not readily apparent that the satcaster's actions in question are covered by the provisions of the Audio Home Recording Act of 1992.
The protection afforded by the AHRA, Batts said, "is not a wholesale, blanket protection for any and all conduct."
At the center of the dispute is XM's sale of digital receivers to its subscribers. Receivers can record and store -- via "cherry picking," as the music labels have alleged -- a private library of copyrighted music for which the subscribers didn't pay.
Siding with the industry's original complaint, Batts added, "XM is both a broadcaster and a distributor but is only paying to be a broadcaster."
Labels want compensation for what they maintain is XM's digital distribution of their protected content. Batts' ruling means the case, which some observers expect will redefine the meaning of "fair use" for the digital age, will go forward unless all parties agree to an out-of-court settlement.
"The AHRA was never intended to allow a service offering distributions of music to duck paying creators what they are due," said Steven Marks, general counsel for the Recording Industry Assn. of America, in a statement. "We hope this decision paves the way for resolving this case in the marketplace."
Individual labels have already cut settlement deals with Sirius Satellite Radio over the same issue, thus avoiding court.
Contact the Variety newsroom at
news@variety.com