SoundExchange's lawsuit seeking more than $3.4 million in unpaid royalties and fees over Sonos Radio has been taken off a federal court's active list. Judge Hernán D. Vera of the US District Court for the Central District of California administratively closed the case on October 16, 2026, Music Business Worldwide reported, and it will stay parked until a New York appeals court decides whether SoundExchange has the right to sue for unpaid royalties in the first place.
What the order says
According to MBW, the order removes the case from the court's “active caseload” until further application by the parties or order of the court, cancels all scheduled dates and requires both sides to report on its status “within 90 days and every quarter thereafter.” The case had already been on hold since December 2025, when Judge Vera stayed it pending the appeal in SoundExchange's “very similar action” against SiriusXM, Digital Music News reported.
The original claim
SoundExchange sued Sonos and Napster, legally Rhapsody International, in June 2025. Sonos Radio, launched in April 2020 and available only on Sonos devices, relied on the statutory license that lets radio-style services play released recordings at rates set by the Copyright Royalty Board, with SoundExchange collecting and paying artists and labels. According to the complaint, Napster handled the service's royalty reports and payments until May 2022, the month Napster was acquired, and the lawsuit alleges the acquisition caused “a complete breakdown of reporting and payment,” MBW reported. SoundExchange claims at least $3,423,844.41 is owed in unpaid royalties, late fees, interest and audit costs. Sonos later moved the service's back end to Deezer, and Napster did not answer the complaint and was recorded in default in August 2025, according to MBW.
Why SiriusXM decides it
In August 2025, Judge Naomi Reice Buchwald in Manhattan threw out SoundExchange's separate suit alleging SiriusXM underpaid more than $150 million, finding that the law naming SoundExchange as collector does not give it the right to sue. SoundExchange called that ruling “entirely wrong on the law,” appealed, and now says the alleged underpayment exceeds $400 million. SiriusXM denies the allegations, MBW reported.
The Second Circuit heard arguments on September 25 and has not ruled. At the hearing, Judge Alison Nathan said it was “hard to read [Section] 114 as something other than a structure by which SoundExchange is designed to collect these royalties,” according to Courthouse News Service as cited by MBW, while SiriusXM's lawyer called SoundExchange “a runaway, a collective, not accountable to anyone.”
What it means for artists
SoundExchange distributes around $1 billion a year collected from about 3,600 licensees, per its Sonos complaint. Digital Music News noted that a ruling for SiriusXM could leave rights owners to fight underpayment battles themselves. If SoundExchange wins, its claim against Sonos and Napster could move forward, MBW noted. MBW said it had contacted SoundExchange and Sonos for comment.