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Rockers Sue Sony Music for Unpaid Royalties on Downloaded Music
Rock bands Cheap Trick and the Allman Brothers have launched a lawsuit against Sony Music for failing to pay royalties they allege are properly owed from digital downloads. The suit’s central allegation is that Sony is treating the digital downloads as physical “distributions”. At the time the bands signed their agreements with Sony, distributions referred to the physical dissemination of hard copies of albums that Sony produced, on vinyl, compact disc or tape. The plaintiffs are seeking to have the Court certify a class, which would include artists that had signed with Sony from the 1960s to 2002.
Artists’ contracts often include terms such as deductions for breakage and packaging on distributions; charges that are clearly inapplicable to paid downloads from a service provider like iTunes or Napster. The bands’ lawyers are claiming that digital downloads should be considered “licensed music”, which is subject to a significantly different royalty system.
The plaintiffs allege that of the 70 cents received by Sony on average for a licensed download of their song from the Internet, they only receive 4.5 cents per song, approximately 25 cents less than they claim is rightfully theirs if the download was considered to be the granting of a license rather than the distribution of a product.
For additional information, visit:
http://www.forbes.com/home/feeds/ap/2006/04/28/ap2707008.html