The Mechanical Licensing Collective has rejected Pandora‘s attempt to use a federal appeals court ruling on horse racing regulation to undermine the collective’s authority to sue the streaming service over mechanical royalties.
In a filing on Wednesday (June 24) in the US District Court for the Middle District of Tennessee, the MLC called the cited ruling “inapposite” and said it “does not advance Pandora’s argument.”
The response came one week after Pandora filed a notice of supplemental authority citing a June 11 decision by the US Court of Appeals for the Fifth Circuit, which found that the enforcement provisions of a federal horseracing law violated the private nondelegation doctrine.
That doctrine restricts Congress‘s ability to hand government enforcement powers to private entities without supervision from a federal agency.
Pandora contends that the same reasoning applies to the MLC – a private, government-designated body created under the Music Modernization Act of 2018 – which can investigate licensees and pursue them in court without sign-off from a government agency.
But the MLC argued that Pandora has forfeited its constitutional challenge by raising it too late in the proceedings.
“Pandora forfeited its constitutional arguments when it chose not to assert them at the outset and instead litigated this action for two years through discovery without once raising them,” the MLC said in its filing.
The collective also argued that it operates under sufficient government oversight to satisfy the nondelegation standard, stating that the MLC and “the individual voting members of its board of directors are appointed and removable by a department head (the Librarian of Congress) and are subject to pervasive oversight by the Librarian and the Register of Copyrights.”
On the substance of the horseracing ruling, the MLC raised three objections.
First, the collective noted that the Fifth Circuit‘s decision does not apply a different legal standard from the one articulated by the Sixth Circuit in Oklahoma v. United States – which is the binding authority in the Middle District of Tennessee, where the Pandora case sits.
Second, the Fifth Circuit‘s specific conclusion that the Horseracing Integrity and Safety Act (HISA) enforcement provisions are unconstitutional “directly conflicts” with the Sixth Circuit‘s conclusion to the contrary.
Pandora itself acknowledged this in its filing, conceding that the Fifth Circuit “expressly parted ways with the Sixth Circuit.”
Third, the MLC argued that the horseracing law’s structure is fundamentally different from the Music Modernization Act.
The MLC said the MMA “fully lacks HISA’s ‘clear delineation'” of enforcement functions, and instead “grants The MLC broad authority to engage in activities concerning the Blanket License, including enforcement, and also grants the agency broad oversight that encompasses The MLC and the entire statutory regime.”
“In sum, Black does not provide Pandora with an escape from the liability that is established in the summary judgment papers,” the MLC said.
The case dates to February 2024, when the MLC sued Pandora in the US District Court for the Middle District of Tennessee, alleging that the company underpaid mechanical royalties on its ad-supported Pandora Free tier.
Both parties filed competing motions for summary judgment in February 2026, each asking Judge Eli J. Richardson to rule in its favor.
In opposition briefs filed in March, the MLC called Pandora‘s constitutional argument “desperate and unfounded.”
The underlying question in the case remains whether Pandora Free qualifies as an “interactive service” under the Copyright Act, which would make it subject to mechanical royalties on all of its streams.
The MLC argues that on-demand listening, unlimited skips and replays, and personalized programming each place the service in that category.
A spokesperson for the MLC told MBW in March that the evidence “confirms that Pandora Free is an ‘interactive service’ and that Pandora has improperly underpaid royalties due to copyright owners under the Blanket License.”
Pandora counters that its free tier operates as noninteractive internet radio, and that its Premium Access sessions, 30-minute windows that free users can unlock after watching a video ad, are licensed separately.
Pandora‘s constitutional argument tracks a separate fight involving its own parent company.
In August 2025, Judge Naomi Reice Buchwald of the US District Court for the Southern District of New York dismissed a lawsuit brought by SoundExchange against SiriusXM, Pandora‘s parent, finding that Section 114 of the Copyright Act does not authorize SoundExchange to litigate royalty disputes.
That ruling turned on statutory interpretation rather than the Constitution, and Buchwald noted that the MLC‘s governing statute, Section 115, expressly grants the collective the power to bring a federal court action.
SoundExchange is appealing the decision.
A ruling from Judge Richardson on the summary judgment motions is pending.Music Business Worldwide
