Class action lawsuit filed against diskeries

MAP policies said to be a 'conspiracy' by the Big Five

By DON WALLER

A pair of New York consumers filed a federal class action suit last week claiming that the Big Five record groups’ recently suspended Minimum Advertised Pricing (MAP) policies violated U.S. antitrust laws.

This action comes two days after two separate California consumers filed class action suits in L.A. Superior Court alleging that the diskeries’ MAP policies flouted restraint of trade and price-fixing statutes — and eight days after the Big Five signed separate settlement agreements with the Federal Trade Commission (FTC) declaring that they would no longer engage in MAP (Daily Variety, May 11).

Filed by Virginia Brown and Sherry Weindorf in U.S. District Court, the New York suit charges Sony, BMG Entertainment, Warner Music Group, EMI and Universal Music with violating the Sherman (antitrust) and Clayton (price-fixing) Acts and accuses them of participating in “a horizontal combination, conspiracy and agreement in restraint of trade and commerce.”

Claiming the Big Five’s MAP policies eliminated any meaningful price competition and fixed CD prices at “artificially high levels,” Brown and Weindorf are seeking trebled damages to be determined.

The two Los Angeles suits, brought by James Retzlaff and David Jenkins “on behalf of California indirect purchasers of pre-recorded music compact discs,” seek damages to be determined at trial.

The FTC estimates that U.S. consumers paid an estimated $480 million more than they should have for CDs over the last three years.

While spokesmen for the Big Five declined to comment, it’s worth noting that their individual FTC settlements not only contained no admission of wrongdoing, but also mandated no monetary compensation for consumers.