US Federal judge rules out class actions by consumers accusing music labels of inflating online prices

Consumers accusing several big music companies of conspiring to inflate prices of music sold over the Internet cannot pursue class actions.

A Manhattan federal judge on 18 July, 2017 said consumers accusing several big music companies of conspiring to inflate prices of music sold over the Internet and on compact discs cannot pursue their claims in class actions.

U.S. District Judge Loretta Preska's 89-page decision is a victory for Sony Corp, Vivendi SA's Universal Music Group, Warner Music Group and various affiliates in the 11-year-old lawsuit, which the judge said has been delayed by extensive disputes over evidence.

Consumers accused the defendants of taking unfair advantage of their 80 percent share of the U.S. market for online music, and that by making such music "less attractive" to buy were able to drive up CD prices.

But the judge said individual questions would "quickly overwhelm" issues common to the potential millions of people who could be represented in a nationwide class action.

She said this was particularly true given the likelihood that a "significant percentage" of potential class members might have "unclean hands" because they downloaded music illegally.

"As defendants have stated succinctly during this litigation, 'a plaintiff may not complain that one hand is being overcharged while the other hand is robbing the store,'" Preska wrote.

Lawyers for the plaintiffs did not immediately respond to requests for comment.

Class actions let plaintiffs pursue claims in groups and potentially obtain larger recoveries than if they were forced to sue individually, which can prove too expensive.

The judge also refused to certify nine separate damages classes for consumers from eight U.S. states and the District of Columbia, saying differences among states' laws would make class action litigation "unmanageable."

Preska also largely rejected an effort to exclude testimony from two antitrust experts retained by the plaintiffs and rejected an effort to exclude testimony from a computer forensics expert retained by the defendants.

The case is In re: Digital Music Antitrust Litigation, U.S. District Court, Southern District of New York, No. 06-md-01780.


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