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Massive Copyright Class Action Settlement Approved: Record Labels to Pay $50 Million

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Tuesday May 31, 2011
The largest copyright class action in Canadian history received court approval yesterday, with the four major record labels that comprise the Canadian Recording Industry Association - EMI Music Canada Inc., Sony Music Entertainment Canada Inc., Universal Music Canada Inc. and Warner Music Canada Co. - agreeing to pay over $50 million to settle claims involving hundreds of thousands of copyright infringements. The labels admit no liability, though the $50 million settlement speaks for itself. The industry practices, which involved profiting from thousands of sound recordings without paying royalties, was described in the lawsuit as "exploit now, pay later if at all." The settlement includes a new system for payment of royalties that should ensure that the situation does not repeat itself. I wrote about the class action here and here.
Comments (22)add comment

Jesse said:

...
We're talking thousands of infringements, where the industry profited from this exploitation, and all they are paying is $50 million. Yet if an internet user downloads a handful of songs and does not profit off of them, they pay $1.5 million.

What am I missing here?
May 31, 2011

Brian said:

Missing: cake and eating it
@Jesse: you are missing that the entire recording industry wants their cake and wants to eat it too.

I wonder of some future lawsuit against a consumer could use the math in this case to bring a judgement down to something not outrageous.
May 31, 2011

Brian said:

pot, kettle, black
Wow. What more can I say? Pot, kettle, black.
May 31, 2011

Ninja said:

And they complain about file sharers...
No rly, I can't even begin to describe the irony of MAFIAA/US/EU pushing for tougher copyright laws at Canada and then this lawsuit.

I'd go to the front of those morons and protest.
May 31, 2011

IamME said:

Think about it...this is a good thing
The RIAA shoots themselves in the foot in settling like this. What this DOES do is establish the "value" of commercial infringement as per the RIAA themselves (Where the value of private infringement is much lower) and sets a precedent which can later be recalled if they try to take anyone else to court.
May 31, 2011

Crockett said:

Why is there so much infringement?
Monkey see Monkey do ...

People are not blind, they know when someone is taking advantage of others as well as themselves. It's the attitudes and practices of the media cartels that perpetuate the disrespect. Once that is lost people have little reason to feel bad about the so called ... "rampant theft that is destroying the entertainment industry". What is commonly portrayed, though is not often the reality, is an industry of riches and glamor that is out to punish the little guy.

Now, as in any disagreement, both sides have some measure of blame. Certainly there are those who through greed return nothing for the value they receive from artists. In this manner they are not only hurting creators, but also themselves as they devalue that which they obviously want to continue to use. Unfortunately for everyone, there always was and will continue to be people of this mindset.

Where does that leave us? Like a dog chasing it's tail this will go on ad nausium until the cycle is broken. The problem is both parties feel agreived and neither wants to step up to the plate. Now, knowing this may sound condescending, it is up to the creative sector to blink as they are in the weaker position. Please bear with me as I explain.

Simply put, there are more consumers than creators and with the tools at hand that the digital age has provided, they have an advantage of both numbers and capability. Creators also depend on the good will of consumers to purchase their goods and provide a financial return for their efforts. Finally, the capability to police, legislate or control such a large populace is not possible without their willing compliance ... which leads back to the perception of respect, both for the law and those who are trying to implement it.

The solution is simple, pull your heads out of the sand and give people good value and service. Quickly retreat from incredulous fines and talk of disconnecting people. Win back their respect, and earn some in return. Sometimes a step back is a leap forward.
May 31, 2011

S said:

...
So, they sold over 300,000 songs over the course of 20+ years and only pay $50 million... I'm willing to bet they made many, many times that amount and are really just laughing all the way to the bank about it.
May 31, 2011

Colin McInnes said:

...
I'll be sure to remind my MP about this blatant flaunting of the law by corporations when they bring up Copyright Reform again. If Sony and EMI can get away with not having to pay an artist more than $160/song (not per copy) 10 years after the fact, then putting fines of thousands of dollars per copy for individuals is a clear violation of my right to equal treatment.
May 31, 2011

Laurence said:

...
I am *never* going to think of feeling bad about downloading music again...
May 31, 2011

Crockett said:

...
Don't use logic were greed is concerned. Plus they have admitted no wrongdoing so you can't use it ad a precisely. Guess they just made a $50 million donation out of the goodness of their hearts 0_o
May 31, 2011

Crockett said:

Darn auto correct cell phone ...
ad a precisely... Should read 'as a precedent'
May 31, 2011

IamME said:

...
They might not have "admitted" to any wrongdoing, but a $50M settlement means they knew they wouldn't win if they took it to court. It's almost as good as an admission of guilt. Perhaps not as a precedent, but a good lawyer should be able to leverage on that in some way.
May 31, 2011

Jeff said:

So little.
So now, if I download/steal a song, I should only have to pay a maximum of $167?

Nah, that seems to high.
How much profit did they make from it?
In the future, for any claims, they should use this.
Get that $50mil, subtract the profits, then divide by the number of songs they stole (someone said $300k), to get some tiny misicule amount, maybe -$100?
May 31, 2011

Cody said:

Lady Justice needs to recalibrate her scales.
Limewire settlement: $10,808 per song, 65x more. 300,000 infringements -> $3.24 billion
Joel Tenenbaum: $22,500 per song, 135x more. 300,000 infringements -> $6.75 billion
Jammie Thomas-Rasset 2010: $62,500 per song, 375x more. 300,000 infringements -> $18.75 billion
May 31, 2011

Crockett said:

An opportunity missed ;)
@Cody "Lady Justice needs to recalibrate her scales"

And the damages should even have been higher than that as they this was both infringement and failure to abide by contract. As well as worse on the morality scale ...

Too bad it didn't go to trial, $18.75 billion would have gone a long way to wipe out the **AA club and finance the actual artists to start over using modern models and better returns.
May 31, 2011

Paul said:

Downloading not relevant
I do not know why people are comparing downloading free songs to a lawsuit settlement. Downloading free songs is not illegal unless they are then sold for profit. You can legally download whatever you wish for your own use.
June 01, 2011

Crockett said:

...
@Paul

The issue here, at least in the USA lawsuits is not so much downloading as redistributing without permission. Most internet programs that are used to download files also upload and share at the same time, this is where the infringement comes into play. If you were to be sued for just downloading a single item then the damages that could be claimed would be minimal and likely not worth the effort, but once you make that item available via the internet the liability grows quickly.

I say the above not to defend or promote file sharing, just to get the facts a little straighter.
June 01, 2011

IamME said:

@Paul
Currently, yes. But not if they kill the private copying levy. Even if they don't, I believe C-32 "rectifies" this. The Conservatives has already indicated they plan to fast-track this. I'd expect Canadians to start seeing law suits and John Doe letters within a year. At the very least, before the end of 2012. Anyone who downloads anything that's going to hit the **AA radar should start weening off now or start looking for alternate sources (Such as Netflix, eMusic, or other similarly cheap services.).
June 01, 2011

MikeB said:

They got off easy..
"According to the original statement of claim, filed in 2008, there were more than 300,000 works on the pending lists. With statutory damages for use of unlicenced work ranging from $500 to $20,000 — and with the plaintiffs claiming the maximum end of that range — the action could have been worth up to $6-billion."

“The result overall is approximately $50.2-million in settlement benefits to the class,” Mr. Foreman said. “I believe it’s a strong financial resolution to the case.” He noted that while the class is still undefined, it likely numbers in the thousands, but not the full 300,000, as many rights holders would have multiple works on the list."

So apparently they didn't negotiate per copy or even per song, but per artist. Wonder if that would be applicable to a civil suit brought on a filesharer.



June 01, 2011

db said:

...
IamME- I believe the levy is just for format shifting, nit for downloading. So no downloading is not necessarily legal, though if you already own the album and were to lazy to rip it, or if it was damaged and unreadable.
Crocket, I thought the charges in the states were for downloading. I know the damages were thought up based on potential uploads, but I thouhgt the actual cases were based on downloads.
June 01, 2011

IamME said:

@db
I thought there was a court case at some point some years ago that determined a downloaded song is equivalent to private use in the same way borrowing a CD from a friend and copying it is considered private use and is legal under the levy.
June 01, 2011

Crockett said:

...
db, I am not certain what the current situation on the legality of downloading is in the USA right now, but my point was no one is going to bother to sue for say just a music track download. It's the redistribution where the big litigation bucks are to be made ;)

Yes, I know the RIAA campaign was a net money looser ... as well as a huge ineffective PR disaster!
June 01, 2011

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