Washington – The U.S. Supreme Court has rejected the major
record labels’ request that it block a lawsuit lodged by consumers who claim
they colluded years ago to fix prices on music sold on the Internet, Bloomberg
reported. Universal Music Group, Sony (NYSE: SNE) Music, Warner Music (NYSE: WMG) and EMI had asked the
Supreme Court to block the lawsuit, after a federal appellate court in New York
agreed with a lower court’s ruling that sufficient evidence existed for the
lawsuit to proceed.
At issue are two early digital music service joint ventures
set up by the major labels — MusicNet and Pressplay.
The lawsuit alleges the
labels charged unreasonable rates for songs, and unreasonably imposed
restrictions on consumers transferring songs to portable players.
alleges the labels colluded to set a base price of 70 cents per song for
selling their songs.
“Both the joint ventures and the Recording Industry
Association of America (“RIAA”) provided a forum and means through
which defendants could communicate about pricing, terms, and use
restrictions,” the lawsuit claims.