Sirius XM Charges More Than Advertised Due to Undisclosed Music Royalty Fee, Class Action Lawsuit Claims

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Sirius XM faces a proposed class action lawsuit that alleges the company has intentionally failed to include in its advertised subscription prices a “U.S. Music Royalty Fee,” which, unbeknownst to consumers, increases the true price of its satellite radio music plans by more than 20 percent. 

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The 51-page Sirius XM lawsuit alleges the company not only purposefully fails to disclose the music royalty fee to subscribers but goes so far as to never mention the words “U.S. Music Royalty Fee” in any of its advertising, including the fine print. 

Even after a consumer signs up for a Sirius plan, the defendant still keeps them from learning about the royalty fee by declining to send monthly or ongoing billing notices or invoices, all while Sirius XM “silently and automatically renews their subscriptions month after month and year after year,” the complaint charges. 

“And, as the price of its subscribers’ music plans increase—e.g., when a promotional rate expires—the U.S. Music Royalty Fee amount, being a flat 21.4% charge, also increases,” the case says, adding that Sirius’ “few” streaming-only subscribers have a lower – but still undisclosed – 8.8 percent fee levied. 

The proposed class action notes that none of Sirius XM’s competitors charge a separate royalty fee over and beyond their advertised music plan prices. Overall, the case alleges the royalty fee charged quietly by Sirius XM is no more than a “disguised double-charge” for the company’s music plan. 

Further, the suit contends that calling the added charge a “U.S. Music Royalty Fee” is deceptive in itself as Sirius XM aims to “falsely indicate to consumers … that it is a government-related fee.” 

Should a subscriber learn about the added royalty fee and contact the defendant, the filing says, Sirius XM will “outright falsely tell[] the subscriber” that it is a government-mandated charge or a government pass-through fee. 

According to the case, the U.S. music royalty charge at issue has been the source of all of Sirius XM’s profits in recent years.

“For example, in 2023, Sirius XM collected $1.36 billion in U.S. Music Royalty Fee charges, while the entire company had net profits of $1.26 billion. In other words, in 2023, U.S. Music Royalty Fee revenues were equal to 108% of the net profits for the entire company.” 

The lawsuit estimates that in the time since it invented and introduced the U.S. music royalty fee in 2009, Sirius XM has unlawfully reaped more than $242 million from consumers in Washington and more than $690 million from Florida consumers. 

The filing lastly mentions that the plaintiffs do not seek to regulate the existence of the royalty fee through their proposed class action but instead aim to have Sirius XM include the amount of the fee in its music plan prices advertised to the general public. 

Per the suit, roughly 33.9 million consumers nationwide have a Sirius XM satellite radio and streaming plan, while approximately 160 million vehicles in the U.S. have Sirius XM radios. 

The Sirius XM lawsuit looks to cover all current and former Sirius XM subscribers in Washington and Florida who paid a U.S. music royalty fee within the applicable statute of limitations period. 

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