The seeds in a newly planted lawn are prone to getting washed away in rain and getting eaten by birds. In "Gardener to Gardener" (2002), Fern Marshall Bradley recommends using pine needles on a new lawn to prevent this from happening.
When using pine needles on new lawn, sprinkle just enough to create a very thin layer over newly seeded areas, which will prevent seeds from getting washed away. Avoid creating a thick layer, as this will obstruct sunlight from reaching the seedlings. A thick layer is also likely to turn into a hard crust and will cause more damage than good.
Though pine needles are good for new lawns, avoid their use in established grass. According to Lane L. Winward in "The Healthy Lawn Handbook" (2001), pine needles contain a resinlike substance that retards the growth of grasses. This substance is also contained in the roots of pine trees. This makes it hard to grow grass under pine trees.