Sirius XM Class-Action Settlement Upheld by Appeals Court

Sirius XM Radio Inc. and its customers won appeals court approval of a class-action lawsuit settlement challenged by some satellite radio subscribers who claimed they got too little and lawyers too much.

The U.S. Court of Appeals in Manhattan today affirmed a ruling by a lower court that approved the suit settlement, valued at $180 million. Plaintiffs’ lawyers were awarded $13 million in fees.

“Competent counsel appeared on both sides, and settlement was reached only after contentious negotiations,” the appeals judges said in their opinion. “Thus the district court did not abuse its discretion when it presumed the proposed settlement was procedurally fair.”

Subscribers sued Sirius XM Radio in 2009, claiming that it violated antitrust law when it raised prices after Sirius Satellite Radio acquired its only competitor, XM Satellite Radio, in 2008. They said Sirius broke promises it made to win merger approval from the Federal Communications Commission.

Sirius XM argued that the price increases were justified to cover higher costs.

In August 2011 Sirius XM won District Court approval of a settlement before a trial was to take place. The accord provided for an unchanged subscription price for five months ending last Dec. 31.

The appeal is Blessing v. Sirius XM Radio, 11-3696, Court of Appeals for the Second Circuit (Manhattan). The lower-court case is Blessing v. Sirius XM Radio, 09-10035, U.S. District Court, District of New York (Manhattan).

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