music labels and their trade group, the Recording
Industry Association of America, scored a
major victory over LimeWire last year, shutting down the P2P
service. The results were noticeable -- an immediate dip in filesharing traffic.
Though perhaps the thrill of that victory will be temporary for the RIAA,
they can console themselves with a record settlement of $105M USD that a jury
awarded them last week after lengthy negotiations.
Filesharing-centric blog TorrentFreak ran one of the first stories on the settlement
and quoted RIAA spokesman Jonathan Lamy as stating, "Any funds recouped
are re-invested into our ongoing education and anti-piracy programs."
This might lead one to believe the music artists would get none of the
After a dialogue with Mr. Lamy we realize this may not necessarily be the case.
First, Mr. Lamy's comment was delivered years ago, when the suit was just
warming up. Second, his comments may have referred to only the RIAA's share
of the settlement -- remember the music labels were co-plaintiffs in the case.
"Far too much credence was given to a TorrentFreak 'report.' The quote
attributed to me was something I said years ago in reference to the end-user
litigation program, which did not generate any revenue for the record
companies." complains Mr. Lamy. "The RIAA has made no comment [at the
time of the settlement] on how the recoveries in the LimeWire case would be
distributed. That is a decision for the individual plaintiffs. However, the
record companies have historically shared large litigation recoveries such as
the KaZaa settlement with their artists.”
Ultimately, TorrentFreak's conclusion -- though not as well sourced
as it appeared -- may still prove semi-accurate.
The New York Times ran a piece on
the settlement in their Media Decoder blog. They
quote Warner Music Group as commenting, "We will share the settlement
money with our artists."
Similar promises were made with lawsuit settlements with other P2P giants,
including Napster, Kazaa, and Grokster. And money was indeed set aside.
But according to many major musicians the money was largely never distributed
to artists. Bob Donnelly, a longtime lawyer for artists is quoted by NYT as
stating, "I don't remember any of my artists’ accountants ever saying,
'Hey, guess what, we got a great bonus this month.'"
Another question that even if some of the money is eventually set aside and
distributed, how it will be divvied out. A major record label can have
thousands of artists on the main label and hundreds of imprints. Some say
that only the biggest artists will stand a decent chance at collecting a piece
of the record loot.
Dina LaPolt, a lawyer for Steven Tyler, the estate of late 90s rap icon Tupac
Shakur, and others is quoted as adding, "It’s going to be the artists that
make noise. They are the ones that are going to get paid."
At the end of the day the settlement provides few answers to the big questions
and challenges facing the music industry. And if history is any indication
RIAA and labels will likely pocket a large chunk the settlement; and the money
they do choose share will go only towards a privileged handful of established
artists. But, for what it's worth, the RIAA wanted to set the record
straight -- they never said that musicians would get nothing.