XM settles patent lawsuit with Universal Music

Mon Dec 17, 2007 5:04pm EST
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By Sinead Carew

NEW YORK (Reuters) - XM Satellite Radio Holdings Inc said on Monday it has settled a patent infringement lawsuit filed by Universal Music Group and hopes to reach deals with the other music companies.

The dispute centers around XM's portable "Inno" device, which can store and record music from satellite radio.

Major music labels including Vivendi's Universal, Warner Music Group Corp, EMI Group Plc and Sony BMG sued XM in May 2006, saying the Inno infringes copyrights and transforms a passive radio experience into the equivalent of a digital download service such as Apple Inc's iTunes.

XM said on Monday it reached a multiyear deal with Universal, which will withdraw from the complaint. It said the pact covers all XM radios with advanced recording functions, including future products. XM did not give the financial terms.

"We look forward to continuing our discussions with the other music companies in hopes of arriving at a resolution that benefits everyone, especially consumers," XM said in a statement.

Warner Music, EMI and Sony BMG, a joint venture between Sony Corp and Bertelsmann AG, all declined comment.

Warner Music is in talks with XM to try to settle the dispute and expects a resolution soon, said a source familiar with the matter who spoke on condition of anonymity.

Janco Partners analyst April Horace said the Universal agreement would likely be followed by others.   Continued...

<p>An XM Satellite Radio unit is shown installed in a private vehicle in Washington, February 20, 2007. REUTERS/Jason Reed</p>