updated 11:50 am EST, Mon January 10, 2011
Supreme Court drops review of digital music suit
The US Supreme Court later on Monday declined to review a lawsuit accusing RIAA music labels of price fixing for digital music. Officials cleared the lawsuit to go ahead after an appeal brought back the case, which had initially been dismissed in 2008. No comment accompanied the decision to uphold the appeal and the case.
The lawsuit by Kevin Starr claimed that EMI, Sony, Universal and Warner all colluded on choosing a 70-cent wholesale price for music, even when stores like eMusic were selling tracks for less. Such pricing has usually been responsible for the most common 99-cent pricing on iTunes, Amazon MP3 and most other US music stores. Variable pricing came about in return for selling all tracks DRM-free but also follows a near-unform price across the industry, ranging from 69 cents for old titles to $1.29 for popular singles.
Labels had tried to shoot down the lawsuit by arguing that the case hadn't provided enough facts to go ahead with the lawsuit before either a possible summary judgment in favor of one side or else a full trial. Attorneys supporting Starr's side of the case countered that the appeal had won based on Supreme Court precedents for what constituted a sufficient case.
The lawsuit if successful would at least punish labels but could also lead to more varied and possibly lower pricing on Internet music stores instead of having uniform pricing. Apple has asked for uniform pricing to provide a consistent experience, but usually on its own terms. Amazon has been willing to sell music at lower prices but takes a loss on many sales to try and inflate its market share.