Internet radio leader Pandora has won a court battle with the music publishing society known as ASCAP (AZ-cap) that could help it lower its royalty payments.
Pandora pays 4.3 percent of its revenue in songwriter royalties to groups including ASCAP, which distributes them to major publishers like Sony/ATV and Warner/Chappell. Starting two years ago, major publishers began to withdraw rights from Pandora, forcing it to reach separate deals.
Judge Denise Cote's ruling in a federal district court in New York on Tuesday said such withdrawals violate the conditions ASCAP has acted under since a 1941 agreement to prevent anticompetitive behavior.
ASCAP says the ruling does not undermine its position that songwriters should be paid fairly by Pandora, an issue to be addressed in a December trial.
Explore further: Pandora Media to issue new stock; shares fall