Beatles Vinyl by Erwin Bernal (CC BY 2.0)

Beatles Vinyl by Erwin Bernal (CC BY 2.0)


Competition Tribunal Gives Go Ahead for Price Maintenance Claim Against Music Industry Giants

The Competition Tribunal has granted leave to Stargrove Entertainment, the Canadian music label that has published public domain recordings from the artists such as the Beatles, to pursue a Competition Tribunal complaint against some of the giants of the music industry. The complaint targets the Canadian Music Reproduction Rights Agency (CMRRA), Universal Music, Sony Music, and several music publishers. I wrote earlier about Stargrove’s complaint and noted the backroom lobbying campaign that succeeded in obtaining a copyright term extension in Canada for sound recordings.

Despite strong opposition from the music industry, the Tribunal granted leave to pursue a complaint of price maintenance in violation of the Competition Act. The Tribunal concluded:

If Stargrove is able to establish that some or all of the Respondents, singularly or in concert, discriminated against it by refusing to issue mechanical licenses motivated by Stargrove’s low-pricing practices, an argument for section 76 relief could be available. The case for relief could be enhanced by credible evidence that mechanical licenses are routinely granted by music publishers to record labels on standard business terms and that Stargrove was treated differently.

The Tribunal was also concerned about the possibility that the conduct could have an adverse effect on competition, citing an email from Universal Canada expressing concern about maintaining market share in the face of competition from Stargrove releases:

I am also satisfied that sufficient credible evidence has been produced to support a bona fide belief that holding Stargrove out of the market could have an adverse effect on competition in a market. In an email exhibited to the affidavit of Ms. Anna Kusmider, a representative from Universal Canada noted one-week CD sales of Universal content through Walmart of 4,172 units. The author expressed concern about maintaining market share. Other evidence presented by Mr. Perusini speaks to Stargrove’s initial success in the retail market and to Walmart’s continuing interest in Stargrove’s CDs. The Respondents’ alleged denials of meaningful access to the market could also be an indication of their concern about damage to the existing higher-priced market for this music.

The case will therefore continue and holds the promise of providing new insights into efforts by some of Canada’s largest music industry participants to keep competition out of the market.


  1. And Trudeau sat there and always kept quiet about it. This is how Industry (record labels + the “Made Men” in musicians circles) lobbyists work and that should tell you enough about TPP which will make things even worst.

    Saw a nice video of someone that mixed dancing scenes from old movies to new music. Think about the CREATIVITY that would arise if copyright terms were put on par with the patent term.

    But as we can see as well, these things aren’t really about exploiting certain recordings, it’s more about keeping near-free music OFF the market.

    Who reads books nowadays? Not many. There’s Project Gutenberg for books, filled with old cobweb-ridden dusty old books, written by people that have died and the better part of a century has passed since then (a few exceptions where it’s “just” half a century since they kicked the can).

    How about a Project Edison where you can download or stream formerly-copyrighted, upgraded-to-public-domain music? Now THAT would open Pandora’s Box and maybe get the public interested in copyright terms and what it actually means to them.

  2. In 2016, we’re still buying CD’s at Walmart?

    • LOL. I haven’t bought a physical CD in almost 20 years.

    • The point isn’t the physical medium. At all.

      The point is the alleged illegal stifling of competition.

      There is no reason that Stargrove couldn’t be distributing electronically if that was the business model they wanted to pursue.

      But in reality they are publishing sound recordings that are 50(+) years old and now in the public domain. The lionshare of the interested market for those are going to be people who have a long history of buying their music on CDs (and vinyl even).

      So CDs in Walmart seems appropriate to me.

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