By Jonathan Stempel
NEW YORK (Reuters) - Sirius XM Holdings Inc on Thursday won the dismissal of a New York copyright lawsuit over the satellite radio company's playing of older songs by the 1960s band The Turtles and other artists, reducing the size of a related settlement between both sides in November.
The 2nd U.S. Circuit Court of Appeals in New York accepted a Dec. 20 ruling by the state's highest court, also called the Court of Appeals, that New York common law does not protect the public performance of songs made before 1972.
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Such protection would have allowed artists like The Turtles, best known for "Happy Together," to collect royalties when their songs are played.
The 2nd Circuit rejected an argument by Flo & Eddie Inc, which is run by The Turtles' Howard Kaylan and Mark Volman and controls the band's music rights, that the state court ruling did not resolve Sirius' liability for unauthorized copying and unfair competition, saying the ruling covered both issues.
Lawyers for Flo & Eddie did not immediately respond to requests for comment. Sirius did not immediately respond to similar requests.
Thursday's decision overturned rulings in 2014 by U.S. District Judge Colleen McMahon in New York.
The case is one of several seeking to force digital radio services such as Sirius and Pandora Media Inc to pay royalties for songs recorded before Feb. 15, 1972.
Such songs lack federal copyright protection, but some artists and labels have won protection under various state laws.
Flo & Eddie's class-action settlement with Sirius on Nov. 28 called for the New York-based company to pay up to $99.2 million to class members.
This included between $45.5 million and $59.2 million for future royalties under a 10-year license, $25 million for past royalties, plus $5 million per state if Flo & Eddie prevailed in pending cases in New York, California and Florida.
Thursday's decision would excuse Sirius from the $5 million New York payment, and let it reduce the future royalty rate by 2 percent, court papers show.
U.S. District Judge Philip Gutierrez in Los Angeles granted preliminary approval of the settlement on Jan. 27. A hearing on final approval is scheduled for May 8.
Five major record companies settled their own lawsuit against Sirius over older songs for $210 million in June 2015.
The case is Flo & Eddie Inc v Sirius XM Radio Inc, 2nd U.S. Circuit Court of Appeals, No. 15-1164.
(Reporting by Jonathan Stempel in New York; Editing by Tom Brown)