NEW YORK - Pandora Media Inc on Thursday said it would pay US$90 million (S$125 million) to settle a lawsuit with five record labels that accused the online music streaming service of cheating them out of royalties on pre-1972 recordings.
No other terms of the settlement were disclosed by Pandora and the labels, including Sony Music Entertainment, UMG Recordings, Warner Music Group, Capitol Records and ABKCO Music & Records.
The deal further scales back a bitter dispute between the music industry and broadcasters over the right to play songs recorded before Feb. 15, 1972. Federal copyright law does not cover those songs and the industry has been filing lawsuits in a attempt to expand its royalty rights.
In June, the companies settled a similar lawsuit against satellite radio provider Sirius XM Holdings Inc for $210 million.
The record companies sued Pandora in April, 2014 in New York state court in Manhattan, demanding an end to Pandora's "massive and continuing unauthorized commercial exploitation" of older songs.
The complaint said the music in question included some of the most legendary artists including the Beatles, the Rolling Stones, the Grateful Dead, Bob Dylan and Elvis Presley.
Pandora's chief executive officer, Brian McAndrews, said in a statement, "We pursued this settlement in order to move the conversation forward and continue to foster a better, collaborative relationship with the labels."
Recording Industry Association of America Chairman Cary Sherman called the settlement "a significant milestone and a big win for the music community."
Pandora is also facing a legal challenge over pre-1972 songs brought by members of the 1960s band the Turtles, known for the hit "Happy Together." That case is currently pending at the 9th US Circuit Court of Appeals.
Capitol and UMG are part of Vivendi SA (VIV.PA), and Sony Music is part of Sony Corp (6758.T).
The case is Capitol Records et al v Pandora Media Inc, New York State Supreme Court, New York County, No. 651195/2014.