Antitrust Case Against Sirius XM Radio Headed for Trial

Trial has been scheduled for May 2, 2011 by the Honorable Harold Baer, Jr in the Southern District of New York in a class action antitrust case brought by subscribers of satellite radio services against Sirius XM Radio Inc. SIRI. The case arises out of the 2008 merger between Sirius Satellite Radio, Inc. and XM Satellite Holdings, Inc. that created Sirius XM, now the nation's only satellite radio company. Plaintiffs allege that the merger of the only two providers of satellite radio in the United States was an illegal merger to monopolize and eliminate competition in the satellite radio market. Before the merger, Sirius Chief Executive Officer Mel Karmazin convinced regulators not to block the deal by promising in congressional testimony that “the combined company will not raise prices” and that the merger would actually result in "lower prices and more choice for the consumer…" After the merger, Sirius XM quickly reversed course and exercised its new-found monopoly power by raising prices as much as 15-40% and eliminating multiple radio stations which reduced consumer choice.