ArtsWatch: MusicNet And Pressplay Monopoly Charges Reinstated

Dismissal of collusion claims against major label joint ventures is overturned
January 18, 2010 -- 1:41 am PST
By Philip Merrill /

The Recording Academy actively represents the music community on such issues as intellectual property rights, music piracy, archiving and preservation, and censorship concerns. In pursuing its commitment to addressing these and other issues, The Recording Academy undertakes a variety of national initiatives. ArtsWatch is a key part of an agenda aimed at raising public awareness of and support for the rights of artists. To become more involved, visit Advocacy Action @ and sign up for Advocacy Action E-lerts.

On Jan. 13 New York's U.S. Court of Appeals for the Second Circuit reinstated previously dismissed claims that major record labels engaged in monopolistic restriction of the online music market. (link) In 2008 the lower U.S. District Court had dismissed antitrust and other related claims brought by plaintiffs who were online music consumers against the terms and pricing used by the MusicNet and pressplay joint ventures. These claims were reinstated and can now be litigated. Since it was reviewing a dismissal, the appeals court treated the plaintiffs' allegations as if they were factually true and then considered whether that would suggest the labels colluded rather than acting independently. This reversal does not suggest that the facts are probably true but allows the case to proceed to its discovery phase. Issues to be investigated include the use of most favored nation clauses and the decision not to license to eMusic's lower-priced service. (link)

RealNetworks' claim that the DVD Copy Control Association allowed the MPAA and its movie studio membership to function as an anticompetitive cartel were dismissed on Jan. 8 by San Francisco U.S. District Court Judge Marilyn Hall Patel. (link) The decision found Real could not have standing to bring an antitrust claim because it was only harmed by being unable to market illegal DVD-ripping products. The company is separately appealing Judge Patel's decision last August that prevented sales of RealDVD software — a product that hacked DVD CCA security in order to make a digital copy, although it afterwards protected the movie file with DRM security. (link)

The National Music Publishers' Association has launched a Web site for its late fee program to collect pending and unmatched royalties from record labels and improve their efficient distribution in the future (link) Publishers wishing to preserve their ability to participate must register by Feb. 14. In subsequent steps, registered publishers will receive an estimate of the royalties they can expect and an opt-in enrollment form for full participation.

On Jan. 12 consumer advocates Public Knowledge organized World's Fair Use Day at Washington, D.C.'s Newseum. (link) While promoting the legitimate role fair use plays in cultural discourse and copyright law, the day's several panels also featured numerous points of view that tend to oppose content owners' interests in practice if not in principle. The blogged version of one popular mashup remixer's remarks said, "Start with [the] assumption that all this copyright stuff doesn't matter much. My goal is to make people happy. This happens when people hear the songs you are familiar with." (link) PK President and Co-Founder Gigi B. Sohn hailed the day as a great success with hundreds in attendance including government policymakers. (link) Sohn said, "There was...agreement that copyright law needs to be reformed and modernized for a digital society."

Spain's cabinet passed proposed measures on Jan. 8 for an administrative system to govern shutting down Web sites engaged in online piracy. (link) The Ministry of Culture would set up an Intellectual Property Commission to receive and investigate complaints, resulting in a recommendation to be reviewed by Spain's High Court. Further consideration of this process is likely to take months with hopes for parliamentary approval by autumn.

On Jan. 13 international creators' rights organization CISAC praised the recent approval by India's cabinet of proposed copyright law modifications to grant movie writers and composers independent rights in their creative works. (link) Multiple GRAMMY winner and CISAC President Robin Gibb said, "Music adds true value to Indian film productions and the fact that the authors of these musical works have had their rights taken away and received no subsequent royalties is unconscionable. The Indian Cabinet has taken a major step towards resolving this problem. Let's hope that the Indian Parliament will follow suit."

The worldwide Green Touch telecommunications research consortium announced its formation on Jan. 11, led by Alcatel-Lucent. (link) Its first meeting is scheduled for next month to develop a five-year plan intended to deliver a reference network architecture capable of operating 1,000 times more efficiently than today's communications networks. U.S. Secretary of Energy Dr. Steven Chu said, "Truly global challenges have always been best addressed by bringing together the brightest minds in an unconstrained, creative environment. This was what we used when putting a man on the moon and is the same approach we need to implement to address the global climate crisis. The Green Touch initiative is an example of such a response." Founding service provider members are AT&T, China Mobile, Portugal Telecom, Swisscom, and Telefonica. Founding academic research members include labs at MIT, Stanford University and University of Melbourne. Many other labs and research institutions are already on board and new members from the global telecom community are invited to join.


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