Print 19 comment(s) - last by Mitch101.. on Jan 15 at 12:32 PM

Appeals court determines original judge was wrong to dismiss the case

The music industry is most known for the willy-nilly sue everyone antics of the RIAA as it sought to stamp out piracy. During the heyday of the suits, the RIAA sued people that were dead, kids, and many others with little or no proof that they had actually done anything wrong.

The massive legal assault on suspected music pirates led to some notable victories by the music industry such as the 2008 legal victory for the industry that set a precedent for people who made music available on file sharing sites. There was a significant case where the people charged the music industry with wrongdoing for a change.

In October of 2008, a district judge in New York dismissed a case brought against defendants including Bertelsmann AG, EMI Group, Sony Corp, Vivendi SA and Warner Music Group Corp and various affiliates of these music companies. The U.S. Second Circuit Court of Appeals in New York has now ruled that the judge on the original 2008 case was in error when he dismissed the suit.

The suit alleges that the defendants named in the original case had conspired together to fix the price of music sold online. The suit also alleged that the defendants limited the availability of downloaded music in violation of antitrust law, specifically a violation of the Sherman Act.

Christopher Lovell, legal representation for the plaintiffs, said, "There was uncertainty in the law over the standards for pleading a price-fixing conspiracy. This decision goes a long way toward clarifying what the standard requires in a way that helps people who paid allegedly conspiratorial prices for digital music."

Lovell is looking to turn the original suit into a class action and feels that the outcome of the case could affect millions by consolidating 28 different state and federal cases from 2005 to 2006. According to the plaintiffs in the case, the named music industry companies conspired to fix the price of a song at wholesale at 70 cents.

Circuit Judge Robert Katzmann wrote that assuming allegations were true there was "enough factual matter" to allow the case to go forward. One key statement that Katzmann pointed out was an assessment by a commenter that "nobody in their right mind" would use services like MusicNet and Pressplay – those are two of the music services ran by the defendants in the case. The judge felt that some sort of agreement for a price floor between the music industry players would have been needed to make those services viable.

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By omnicronx on 1/14/2010 1:34:44 PM , Rating: 0
The judge felt that some sort of agreement for a price floor between the music industry players would have been needed to make those services viable.
How about we let the industry fend for itself, good services with good pricing will flurish, others that cannot adapt will not.. It should not be left up to the courts to decide whether or not a floor for pricing makes these services viable.

RE: or..
By ice456789 on 1/14/2010 1:48:58 PM , Rating: 5
I believe what they are saying is that the industry created a floor just so their own crappy music services could compete. Without the artificial floor they would be out of business.

The court is not being asked if a price floor makes the services viable, the court is being asked if an illegal price floor exists at all. If it does, then certainly antitrust laws have been broken.

RE: or..
By TheDoc9 on 1/14/2010 1:53:29 PM , Rating: 2
Let me guess, you're an artist or in some way tied to the corrupt entertainment industry. The market won't adjust when all of the players are in on the scam.

RE: or..
By phattyboombatty on 1/14/2010 2:02:25 PM , Rating: 2
So you've got no problem with price-fixing?

RE: or..
By omnicronx on 1/14/2010 7:51:59 PM , Rating: 3
I surely do have a problem, but apparently I lack reading comprehension skills. I thought that was a quote from the original judge justifying the floor price.

RE: or..
By akugami on 1/14/2010 2:19:56 PM , Rating: 5

Maybe cause the music industry is corrupt and probably only slightly better than organized crime. Maybe because there has been previous examples of price fixing. Not to mention the other shenanigans that the industry has pulled since its very inception like the creative accounting practices used to screw the artists who are the lifeblood of the industry.

The industry is in for major changes. You know it. I know it. More importantly, they know it. They're doing everything they can to retain the status quo for as long as possible. The problem is today's artists are more aware of contract laws and maximizing profits for themselves and not letting the industry get one over them. The dinosaur will die, but it'll make a lot of noise in its death throes.

RE: or..
By fic2 on 1/14/2010 3:15:28 PM , Rating: 2
CNBC has a one hour special on the music biz. One of the bands they talk to is Bare Naked Ladies which went indie a few years ago. Interesting listening to them talk about it. They say they sell fewer CDs but make way more money than they did with a label.

RE: or..
By foolsgambit11 on 1/14/2010 7:52:02 PM , Rating: 2
On the other hand, their level of exposure is at the level it is today thanks to the marketing of their previous label, at least to some degree, and that helps them to sell as many records as they do now, and book as many concerts as they do now. I'm not trying to support the Big 5, but the Bare Naked Ladies are a special case, and don't necessarily reflect the industry at large. Who makes more, the average indie artist or the average major label artist? That would be a more apt comparison, if what we're interested in is money in the first place.

RE: or..
By someguy123 on 1/14/2010 9:55:29 PM , Rating: 3
While I agree that the industry's big 5 are masters of exposure, technically BNL and other artists are paying directly for that exposure. The labels are basically just like banks fronting them incredible loans for things the band may not even want, with no risk to the label since, if the band fails, the debt is completely on the band.

I wouldn't say it's possible to make a truly fair comparison, because the average would be heavily skewed by the above average multimillionaires connected to labels (maria carey etc).

If you were to neglect the top 1% of the artists connected to the Big 5 then indie artists, on average, would probably receive more money.

RE: or..
By Jalek on 1/14/2010 6:20:35 PM , Rating: 1
Sounds like the complaint isn't asking for the courts to fix a price, but to address collusion between several of the larger corporations involved.

It sounds like it's properly framed under anti-competitive practices and they'll have their day in court to explain. Why is this a bad thing? Corporations aren't above scrutiny, at least not yet.

RE: or..
By kart17wins on 1/14/2010 7:48:38 PM , Rating: 3
After reading the USA Today article. The first thing that comes to my mind is why doesn't this apply to the video game industry?

They sure seem to have MAP.

RE: or..
By someguy123 on 1/15/2010 1:15:09 AM , Rating: 2
Not really. There are plenty of games (especially on steam/360 arcade/PSN) that are much cheaper than your average game you see in a brick and mortar store, and I believe wii's titles are about 10 dollars cheaper than 360/ps3 titles on release. I believe steam also have random sales where games are as low as 5 dollars.

The 60$ is more of a standard consumers seem to be willing to pay, rather than an artificial price floor fixed by gaming companies.

RE: or..
By Mitch101 on 1/15/2010 12:32:33 PM , Rating: 2
Steam really kicked arse this holiday season. I got enough games from steam to keep me going until next years sale which I hope they do again. One I already had just because steam does such a great job of patching the games.

RE: or..
By karielash on 1/15/2010 12:10:16 AM , Rating: 2
But I am sure that after their next political 'Donation' they will be....

"We can't expect users to use common sense. That would eliminate the need for all sorts of legislation, committees, oversight and lawyers." -- Christopher Jennings
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