An appeals court upheld a lower court’s ruling on a settlement between Sirius XM Radio Inc (SIRI) and its subscribers, who sued the company after it bought out XM Satellite Radio, its only competitor. The appeal claimed that the subscribers got too little in the settlement and the lawyers got too much.
Sirius XM Radio Inc (NASDAQ:SIRI) has won an appeal on a class-action settlement brought by subscribers.
The $180 million settlement was awarded to Sirius XM Radio Inc (NASDAQ:SIRI) after subscribers sued the company in 2009 not long after Sirius Satellite Radio purchased XM Satellite Radio, the only other satellite radio provider. Bloomberg reports that the subscribers who lost the lower court ruling said the lawyers in the case got too much under the settlement and they got too little. In that settlement, the court awarded the lawyers for the plaintiffs $13 million in fees.
According to Bloomberg, the appeal judges said about the case, “Competent counsel appeared on both sides, and settlement was reached only after contentious negotiations. Thus the district court did not abuse its discretion when it presumed the proposed settlement was procedurally fair.”
The lawsuit claimed that Sirius XM Radio Inc (NASDAQ:SIRI) violated anti-trust laws when it purchased XM Satellite and then raised prices. They also said the company broke the agreements it made in order to receive approval for the merger from the Federal Communications Commission. Sirius XM argued that it needed to raise prices because its costs were higher after it purchased XM Satellite.
Sirius XM Radio won the original settlement in 2011 before the case went to trial. That settlement included a subscription price that wouldn’t change for five months, which ended in December 2011.
Shares of Sirius XM Radio Inc (NASDAQ:SIRI) lost 1 percent in pre-market trading Friday morning, erasing the stock’s 1 percent increase at market close on Thursday.