New York (Reuters) - A 1960s rock band has won a second victory against Sirius XM Holdings Inc in a closely watched copyright battle affecting digital media.

United States District Judge Colleen McMahon in Manhattan on Friday rejected Sirius' request to dismiss the lawsuit accusing the satellite radio company of playing pre-1972 songs from the band The Turtles, best known for the hit Happy Together, without permission or paying royalties.

She said that unless Sirius by Dec 5 raises any factual issues requiring a trial, she will rule outright for the plaintiff, Flo & Eddie Inc, a company controlled by founding Turtles members Howard Kaylan and Mark Volman, and begin to assess damages.

Sirius and its lawyers did not immediately respond to requests for comment.

Harvey Geller, a lawyer for Flo & Eddie, said his client is pleased. "From coast to coast, the owners of pre-1972 recordings are finally getting what is owed to them," he said.

Though songs recorded before Feb 15, 1972, are not covered by federal copyright law, some recording artists and labels have been seeking copyright protection under individual state laws.

Flo & Eddie sued Sirius in New York, California and Florida, seeking class action status and more than US$100 million (S$130 million) of damages for alleged infringements by New York-based Sirius.

In September, US District Judge Philip Gutierrez ruled in the California case that the band had a right "to possess and use its sound recordings and prevent others from using them". The court in Florida has yet to rule on Sirius' liability.

In the New York lawsuit, Sirius said state law did not cover the band's claims, and that its copies of Turtles recordings constituted fair use.

McMahon, however, called it "common sense" that "Flo and Eddie would suffer market harm when Sirius takes its property and exploits it, unchanged and for a profit". She said Congress had authorised New York to regulate pre-1972 recordings, and that the state has long protected public performance rights in works other than sound recordings. "Sirius suggests no reason why New York - a state traditionally protective of performers and performance rights - would treat sound recordings differently," she wrote.

She acknowledged that her decision and Gutierrez's could have far-reaching consequences, such as prompting other lawsuits or causing more states to change their copyright laws, but said "the broader policy problems are not for me to consider". Sirius has said it will appeal Gutierrez's decision.

Flo & Eddie has also sued Internet radio company Pandora Media Inc.

The case is Flo & Eddie Inc v. Sirius XM Radio Inc et al, US District Court, Southern District of New York, No. 13-05784.