TORONTO - XM Canada says it still wants to meet its royalty payment obligations to a group representing Canadian songwriters, but believes the economic downturn has made it difficult to pay them on time.

The satellite radio provider, which is owned by parent company Canadian Satellite Radio Holdings Inc. (TSX:XSR), issued a brief statement on Wednesday noting that retroactive payments required by the CRTC have dealt XM Radio an extra challenge.

"The company is committed to meeting its obligations but notes that its royalties include a significant retroactive tariff to 2005, coming due during a very challenging economic time," XM Canada said.

A second lawsuit was filed on Wednesday by SOCAN, or the Society of Composers, Authors and Music Publishers of Canada, alleging that XM Canada has missed payment of copyright royalties.

"SOCAN finds XM's position untenable, particularly in light of the fact that satellite radio service operators knew of their requirement to pay SOCAN royalties well before they began operations in 2005," vice-president Paul Spurgeon said in a release.

"XM's failure to pay the royalties, which are significant, deprives composers, lyricists, songwriters and music publishers from Canada and around the world of the compensation they deserve and to which they are entitled."

On Tuesday the CSI, a group representing Canadian songwriters and music publishers, filed its own lawsuit in Federal Court alleging that XM Radio defaulted on its royalty obligations.

None of the involved parties provided specific financial figures on how much it owes in retroactive payments, saying the details were confidential.

CSI is seeking an injunction prohibiting XM Radio from broadcasting songs by Canadian artists represented by CSI and the Society of Canadian Authors and Music Publishers of Canada until payment is made.

According to court documents, CSR was required to pay royalties by July 31 of this year, but hasn't done so. CSI alleges that the satellite radio company has indicated it will not pay royalties until 2010.

XM Canada spokesman Peter Block said in an email that XM is "having a strong year relative to last year, but the industry remains unprofitable."

"It is important to note that this is a young industry with extensive up front capital expenditures," he wrote.

In July, the parent company reported that revenues grew 30 per cent to $13.5 million in the third quarter. Profits were $24.4 million, a turn around from $18.8 million in losses a year earlier.

In May of this year, the Copyright Board of Canada certified a tariff to be paid each month by multi-channel subscription satellite radio services for broadcasting Canadian music.

The tariff includes retroactive royalty payments dating back to 2005, when XM Radio first went on the air in Canada.