Sony Pays $8 Million To Settle Digital-Music Lawsuit With Cheap Trick And Others

Posted by on March 9, 2012

The remaining major labels have been finding themselves in court with musicians as of late over digital music revenue. While the battle about whether digital purchases constitute as “sales” or as a “license” continues on, Sony has made a settlement outside of court with one class action lawsuit.

Sony BMG have made a settlement in a five year old case involving groups like Cheap Trick, The Allman Brothers ,and The Youngbloods. As part of the settlement, Sony will pay the musicians and lawyers a total of $7.95 million, while also providing a 3% bump in artists’ royalty rates with respect to digital income. If approved, artists who had at least 28,500 total downloads off of iTunes will get a large portion of the settlement, while the lawyers will take $2.5 million. Other artists who are eligible for the suit were signed with the label from 1976-2001 and have contract clauses stating they would receive 50% of net revenue for licensed music.

On the one hand, this is far less than the original $25 million the plaintiffs originally sought. As Billboard.biz points out, though, the 3% bump in digital royalty rates is in favor of the artists. And now Sony can prepare themselves for more lawsuits over digital revenue, such as the recent one filed by Toto.

[via Billboard.biz]

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Categorised in: Legal Woes