Men At Work, seen here in 1983, included (from left) Colin Hay, Ron Strykert, John Rees, Jerry Speiser and Greg Ham. Dave Hogan/Hulton Archive/Getty Images

Record company EMI has lost its appeal over the 2010 ruling that the catchy Men at Work song Down Under includes a melody lifted from a children's song.

A three-judge panel in Australia's Federal Court has upheld the previous decision that Down Under's famous flute riff was copied from the popular children's folk song Kookaburra Sits in the Old Gum Tree.

The panel has ordered EMI to pay court costs for the appeal.

Marion Sinclair, an Australian teacher who died in 1988, wrote Kookaburra for a Girl Guides competition more than 70 years ago. The song about the Australian bird has also become a popular children's tune in New Zealand, Canada and other countries.

Publishing company Larrikin Music, which now holds the copyright for the song, filed a lawsuit against Men at Work in 2009.

Men at Work members Colin Hay and Ron Strykert wrote Down Under — which follows an Australian travelling the world — in the late 1970s. It topped the music charts in 1983, helped the band win best new artist at that year's Grammy Awards and remains an unofficial anthem for Australia.

Hay and Strykert have claimed that any reference to Sinclair's tune was unintentional, while EMI had argued that the inclusion of the similar melody was akin to a "tribute."

In February 2010, Australian Federal Court Justice Peter Jacobson ruled that Down Under's characteristic flute melody replicates "a substantial part" of Kookaburra. A few months later, he ordered EMI to pay Larrikin five per cent of Down Under's royalties since 2002.

Larrikin had vowed to seek up to 60 per cent of the royalties earned since Down Under's release in the 1980s, but Jacobson said he considered that high figure "excessive, overreaching and unrealistic."