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Antitrust Case Against RIAA Reinstated
NewYorkCountryLawyer writes "After Starr v. SONY BMG Music Entertainment was dismissed at the District Court level,
the antitrust class action against the RIAA has been reinstated by the US Court of Appeals for the Second Circuit. In its 25-page opinion (PDF), the Appeals court held the following allegations sufficiently allege antitrust violations: 'First, defendants agreed to launch MusicNet and pressplay, both of which charged unreasonably high prices and contained similar DRMs. Second, none of the defendants dramatically reduced their prices for Internet Music (as compared to CDs), despite the fact that all defendants experienced dramatic cost reductions in producing Internet Music. Third, when defendants began to sell Internet Music through entities they did not own or control, they maintained the same unreasonably high prices and DRMs as MusicNet itself. Fourth, defendants used MFNs [most favored nation clauses] in their licenses that had the effect of guaranteeing that the licensor who signed the MFN received terms no less favorable than terms offered to other licensors. For example, both EMI and UMG used MFN clauses in their licensing agreements with MusicNet. Fifth, defendants used the MFNs to enforce a wholesale price floor of about 70 cents per song. Sixth, all defendants refuse to do business with eMusic, the #2 Internet Music retailer. Seventh, in or about May 2005, all defendants raised wholesale prices from about $0.65 per song to $0.70 per song. This price increase was enforced by MFNs.'"
Its not exactly most favored nation, if there's no advantage to being so.
my band is more brutal techno punk than yours
Who is going to compensate me for my increased stress level from living in fear of being sued by the RIAA? If I had kids and I wanted them to behave, I'd just tell them stories about the RIAA coming to get them and financially ruin them.
Don't jaywalk kids because the RIAA will come get you.
Eat your vegetables so you can be strong to fight the riaa.
Seriously though, I hate those guys.
--------- I have no signature
Thanks for keeping us in the loop NYCL.
These seem to be serious allegations. I hope there's action taken this time.
These deserve to be kept in mind:
http://archive.salon.com/tech/feature/2000/06/14/love/ (Courtney Love Does the Math, from 2000 - looking at it now, oddly prophetic)
http://www.negativland.com/albini.html (The Problem with Music, by Producer Steve Albini - great insight into the process of Major Label music)
This is why we should care. I know that it's clichéd, but these companies care nothing about you, or about music, or about the well-being of the world in which they operate. They are wholly evil, in a way that almost no other business is.
sig?
It is interesting to read the opinion. Conspiracy to fix prices, agreements to not compete against each other, all record companies refusing to do any business with certain companies.
They are acting like a monopoly. This is what led to the breakup of Standard Oil back in the early part of the 20th century and the breakup of the Bell System into Baby Bells.
This most favored nation (MFN) deal they have going and how all prices change in lockstep.
Wow, it reminds me of how they eventually caught Al Capone. Not on running a crime syndicate but on tax evasion.
Tisha Hayes
Speaking as someone who's very close to the RiAA this is what I have to say:
You people have no chance! We own the Congress, we have more lawyers and eventually, NYCL WILL come over to the Darkside - it's only a matter of time.
You little thieves just need to stop stealing our music!
We now have factories in Malaysia, Indonesia, and Africa that produce music - all run by small children that are paid with barely enough food to live. We just hire good looking people to lip synch in videos and "live" shows. And then when they can't work anymore, we sell the little girls into prostitution and the boys are then trained to be our stormtroopers.
So just shut up! I have to go. My stupid idiotic maid made my afternoon cocktail with the blood of kittens when I especially ordered her to make it with the blood of puppies!
Courtney!
So they're finally calling them on the price fixing of CDs?
I wonder if Hollywood Accounting could save them.
i think the point is that 1) all the record companies set the same price and 2) they all raised their prices together. these two facts seem to demonstrate collusion in the market. that being the case or not is up to the courts.
turn up the jukebox and tell me a lie
Can't [all major labels' simultaneous royalty] increase (approximately 7%) be explained by typical inflation and justifiably be expected every two years?
Why doesn't it decrease as the cost of producing music decreases? Look at how much it cost to record an album in 1980 vs. now.
Ditto. Yes, this story makes me so happy, I'm willing to be a dittohead for awhile. Enjoy while you can! ;^)
"Windows is like the faint smell of piss in a subway: it's there, and there's nothing you can do about it." - Charlie Br
You little thieves just need to stop stealing our music!
Your labels also own music publishers, the companies that own copyright in the music and lyrics apart from the recording. If you provide us indie songwriters with an automated way to check any song we've written against these music publishers' catalogs to make sure we didn't screw up like George Harrison ("My Sweet Lord") or Michael Bolton ("Love Is a Wonderful Thing"), we might take you up on this offer.
I've bought hundreds of dollars in music (mostly online) over the last 5 years. If in fact the court rules that they have been fixing prices will I get any of that money back?
Screw these MF's and their MFN's!
It's not the price, it's the collusion. The labels are supposed to be in competition with each other. Slashdot has repeatedly recognized that the business of a business is to make money - by whatever means possible. Without collusion and general agreement in the backrooms and lounges, one or more labels might actually become convinced that giving away lots and lots of music is the true route to fortune. Baen Books has learned that lesson - especially with older books. They release an out of print book, FOR FREE, and people not only start asking for that book, but they purchase even more books by the same author, and/or in the same genre.
In the case of the labels represented by RIAA, everyone is part of the Good Old Boy's club, everyone is in lockstep, with the same program, same menu, same tactics. They have a happy status quo, and no one is about to rock the boat with anything so barbaric as COMPETITION!!
"Windows is like the faint smell of piss in a subway: it's there, and there's nothing you can do about it." - Charlie Br
Is there any means for artists to claim the companies colluded on contracts, royalties, etc.? I don't know any information there so it may be they were competitive enough to avoid any claims being able to stick, but knowing how bad it is for the artist I'm more concerned about fixing that before we make things better for the consumer.
My webcomic
It occurs to me that all it takes to break up a 'cartel' like this is one or two successful publishers who are not owned or controlled in any way by the existing publishers, and that such independent publishers are willing to really compete with the other labels to sign talent and publish music. The question is, are there any independent labels right now? I remember seeing a chart sometime ago which showed how a lot of 'independent labels' are really owned by the big music publishers, who just use those other labels to either serve niche markets, or create the illusion of having alternatives to dealing with them.
Anyone know of any labels which really, truly, are independent, with which bands and music lovers might do business?
Thanks for bringing this to our attention NYC, but if you'll excuse the pun, we've heard this tune before. Suppose that the RIAA loses and is ordered to pay restitution, but instead of cash the court allows the RIAA and its members to "pay" by donating a selection of CDs or downloads of their choice (i.e. their choice of the worst selling items) while valuing them, for the purposes of the settlement, at "full retail" (even though almost none of them actually sell at that price in the real world). What will prevent them from offering an equally "useless" settlement payment, as they have been allowed to do in the past, again this time?
Try here: http://www.youtube.com/watch?v=wEmTbpvj9fM
I assume that your link is to this song, "Don't download this song" by Weird Al.. The song is quite heavy and very obvious critic against RIAA and it's scare tactics of destroying lives because of a few downloaded songs and about how they have the whole legal system (lawyers, judges the police) under their control. The irony of not being able to legally watch the video outside USA is overwhelming.
That is very common, however. For example many TV shows can't be watched online from Europe anymore. Southpark and The Daily Show being two of the many series that you used to be able to watch online for free (and see some commercials) but now need to download from bittorrent. I could of course just use VPN to some host in USA but really... If I need to go through the trouble of circumventing the protections anyway, my interest to pay for a good VPN and watch the ads isn't that high.
that is the fact that the canadian arm of the R.I.A.A. up here called the CRIA hasnt paid 300,000 artists since 1980.
BOY oh boy thats a bomb to say in court eh?
if they are commercially pirating up in canada , are they doing it in the USA and other countries and does that mean that record breaking profit year really mean profit to the riaa OR is it fraudulently stolen monies.
It is also collusion that lets stuff like DRM live on. I think the comment about eMusic in the summary is telling. If the record labels had in reality been competing with each other, DRM would be history by now. It would just take one label to start selling music as mp3s, and customers would flock to them.
The summary was entirely factual, and didn't contain any "anti-RIAA propaganda". Your quote was for a reader comment, not from the original summary.
Read the Starr vs Sony decision linked in the summary and you'll discover that the appeals judges found the evidence is strong that RIAA members have been colluding using illegal (under antitrust law) methods such as price fixing. E.g., they ask why RIAA members raised the wholesale price from $0.65/song to $0.70/song while the second largest distributor of music, eMusic, was wholesaling at $0.25/song. In the stereotypical "normal free market", competition as well as decreased production costs would lead to lower prices.
The summary was entirely factual, and didn't contain any "anti-RIAA propaganda". Your quote was for a reader comment, not from the original summary. Read the Starr vs Sony decision linked in the summary and you'll discover that the appeals judges found the evidence is strong that RIAA members have been colluding using illegal (under antitrust law) methods such as price fixing [wikipedia.org]. E.g., they ask why RIAA members raised the wholesale price from $0.65/song to $0.70/song while the second largest distributor of music, eMusic, was wholesaling at $0.25/song. In the stereotypical "normal free market", competition as well as decreased production costs would lead to lower prices.
I love people who actually read the stuff. Thank you.
Ray Beckerman +5 Insightful