CD Price Fixing lawsuit ends

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  • Andrew Pratt
    Moderator Emeritus
    • Aug 2000
    • 16507

    CD Price Fixing lawsuit ends

    CD Price Fixing Scam Settled
    United States (Oct. 01, 2002 - 07:05)

    NEW YORK (AP) -- The five top U.S. distributors of compact discs and three large music retailers have agreed to pay $143 million in cash and CDs to settle charges they cheated consumers by fixing prices, authorities announced Monday.

    The settlement brings to a close accusations made by attorneys general of 41 states and commonwealths who accused record companies of conspiring with music distributors to boost the prices of CDs between 1995 and 2000.

    The companies broke state and federal antitrust laws, costing consumers millions of dollars, the attorneys general had charged in a lawsuit filed in August 2000 in U.S. District Court in Manhattan and later moved to Portland, Maine. A judge there must approve the deal.

    The settlement calls for $67.3 million cash to be distributed to the states to compensate consumers who overpaid for CDs and to pay court costs and attorneys' fees.

    Consumers who bought CDs between 1995 and 2000 can file claims for part of the money, prosecutors said. Announcements will be made later to tell consumers how to participate in the payout.

    The settlement also requires 5.5 million CDs valued at $75.7 million to be distributed to public entities and nonprofit organizations in each state to promote music programs.

    The settlement will be distributed according to state population, although attorneys in the case are still working to determine a formula. New York, for example, will receive about six per cent of the settlement.

    Consumers in all 50 states will benefit under terms of the settlement, New York State Attorney General Eliot Spitzer said in a statement.

    "This is a landmark settlement to address years of illegal price-fixing," Spitzer said. "Our agreement will provide consumers with substantial refunds and result in the distribution of a wide variety of recordings for use in our schools and communities."

    The music distributors participating in the deal are Bertelsmann Music Group, EMI Music Distribution, Warner-Elektra-Atlantic Corporation, Sony Music Entertainment and Universal Music Group.

    "We deny any wrongdoing," Warner-Elektra-Atlantic said in a statement. "We have made a business decision to settle these matters and avoid continuing with expensive and protracted litigation."

    Nathaniel Brown, a Bertelsmann Music Group spokesman, noted that the settlement does not include any admission of wrongdoing. He said the company maintains that its pricing practices were "appropriate and lawful."

    Sony declined to comment. EMI and Universal did not immediately return telephone messages seeking comment.

    Also included in the deal were three national retail chains: Trans World Entertainment, Tower Records and Musicland Stores, a division of Best Buy Co. Inc.

    Dawn Bryant, a spokeswoman for Musicland, said the company had no immediate comment. Trans World Entertainment spokesman John Sullivan said, "We were wrongly accused and nobody admitted any wrongdoing." Tower Records did not immediately return messages.

    The lawsuit alleged that the companies -- upset with low prices charged by some stores -- conspired with retailers to set music prices at a minimum level, effectively raising the retail prices consumers paid for CDs.




  • George Bellefontaine
    Moderator Emeritus
    • Jan 2001
    • 7637

    #2
    Why the dirty, rotten, lowdown, no-good scoundrels. I say give them all the electric chair. :x




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    • David Meek
      Moderator Emeritus
      • Aug 2000
      • 8938

      #3
      I just wonder what the amount of "fixing" per CD was? :F




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      • Lex
        Moderator Emeritus
        • Apr 2001
        • 27461

        #4
        I would say about 4 bucks. It seems I remember CDs going from 12.99-13.99 to 17.99 pretty much all at once. Sounds right, doesn't it? Me? I haven't bought to much standard stuff, but bought quite a bit of jazz. I think the bulk of the litigation will be on new releases. However, who keeps receipts for CDs? Anyone? How on earth will they ever distribute anywhere near fairly?

        Oh yeah, we didn't do anything wrong. That's why we are settling to avoid going to court. Yeah right! They had them cold, so they caved is more like it.

        Lex
        Doug
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        Comment

        • Kevin P
          Member
          • Aug 2000
          • 10809

          #5
          Of course what will come of this? Lower CD prices? I doubt it. And then the record companies complain how CD sales are down and are blaming piracy and are trying to make it legal to hack into people's computers and such, when it never seems to occur to them that (a) we're in a recession, (b) most music nowadays is garbage, and (c) the garbage is overpriced! :roll:

          Funny how most of my CD purchases are 80s compilations...

          KJP




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          Comment

          • JonMarsh
            Mad Max Moderator
            • Aug 2000
            • 15272

            #6
            You think we've had it bad here?

            I was just in the UK for two weeks the beginning of September. The British pound is worth about $1.45 to 1.50.

            Current release CD's of major artists sell for 16.99 to 17.99 pounds in the UK- that's about $24 bucks each! Don't even ask me what the equivalent selling price for DVD-A and SACD is in UK- again, they're marked the same in pounds as we buy in dollars. Yes, there are special sale items, local artists and discount specials that drop the price to the 10 - 12 pound range, but that's still as high as our "normal" CD prices!


            -Jon




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            • John Holmes
              Moderator Emeritus
              • Aug 2000
              • 2703

              #7
              Well, it's nice to see the good guys win a few! :yeah:




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              • Eduardo
                Moderator emeritus
                • Jun 2002
                • 1258

                #8
                Consumers who bought CDs between 1995 and 2000 can file claims for part of the money, prosecutors said. Announcements will be made later to tell consumers how to participate in the payout.

                I wonder how? You would have to be very anal and saved all your receipts.




                http://home.nc.rr.com/ejimenez

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                • David Meek
                  Moderator Emeritus
                  • Aug 2000
                  • 8938

                  #9
                  Well, any CD's with a copywrited date between those years should qualify regardless, correct? On older titles you purchased, yes you'll probably need a receipt.

                  Just reading tea leaves here. . . and trying to figure out how many CD's I purchased in those 6 years (it was a BUNCH).




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                  • Brandon B
                    Super Senior Member
                    • Jun 2001
                    • 2193

                    #10
                    Well, since the 5.5 million CDs were valued at $75.7M, that would seem to indicate the court thinks $13.76 is the fair price for a CD.

                    CDs in Japan were outrageously priced too (along with everything else except plumbers). It was cheaper to order from Amazon.com with shipping and import tax than buy local while I lived there.

                    It is good to know the labels can fail in court though, gives a little hope in the whole DMCA/copyprotection/legal hacking fiasco.

                    BB

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