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.
It also
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.
Related Links:
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(Bloomberg)
