AceShowbiz - In a recent legal battle, Pandora is urging a judge to dismiss a lawsuit initiated by the Mechanical Licensing Collective (MLC) regarding streaming royalties. Pandora accuses the MLC of “abusing” its authority with what it claims is an unconstitutional case. In contrast, the MLC argues that Pandora is simply attempting to evade accountability for what it describes as “unlawful underpayment” of royalties.

The MLC first filed suit against Pandora, which operates under SiriusXM, two years ago, alleging that the streaming service misclassified its offerings to sidestep paying higher royalties associated with “interactive” platforms, which include competitors like Spotify. As the case approaches a pivotal moment, both parties are making their respective appeals to the court.

In a robust motion submitted on Thursday, Pandora characterized the lawsuit as a “gross overreach” intended to compel the company to pay exorbitant sums for rights it claims it does not require. The streaming service further contends that the MLC, a private entity, is “exploiting” and “abusing” its limited powers.

“The brazen nature of the MLC’s efforts here cannot be overstated,” stated Pandora's legal team, asserting that the case should be dismissed without proceeding to trial. They argue that permitting a private, unaccountable entity like the MLC to act as an enforcer of the Copyright Act, without federal oversight, constitutes “delegation in its most obnoxious form” and is evidently unconstitutional.

The MLC responded to Pandora’s claims with its own motion on the same day, urging the judge to hold Pandora accountable for its alleged “unlawful underpayment of royalties.” The MLC argues that Pandora’s attack on its authority serves as a distraction from the substantial evidence supporting their claims, which indicate that the streaming service must comply with its payment obligations.

“Pandora has poured resources into litigating a refusal to accept the obvious,” the MLC’s legal representatives asserted. They noted that the company has been ignoring its own admissions while offering “semantic defenses” to obscure the undeniable truths regarding its payment practices.

Established by the Music Modernization Act in 2018, the MLC was created to collect mechanical royalties from streaming services. The lawsuit against Pandora was filed in February 2024, claiming that the company employed bookkeeping strategies to minimize its payments to songwriters and publishers, raising fundamental questions about the nature of streaming rights.