Class Action Lawsuit Brought Against Record Clubs by Composers and Songwriters

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LOS ANGELES (Film Music Magazine) — In March of 2002, a class action lawsuit was filed in U.S District Court demanding that full mechanical royalty payments be made to composers and songwriters for the sale of recorded music distributed by Columbia House and BMG Direct, commonly referred to as record clubs. A motion to dismiss the lawsuit was denied by the Court in September of 2002.
This class action lawsuit, most commonly known as “The Three-Quarter Rate Case” alleges that Columbia House and BMG Direct have been paying music writers at a rate of only 75% of the statutory rates to which they are lawfully entitled. Attorneys for the plaintiffs allege this practice deprives music writers of over $100 million dollars annually. The lawsuit seeks that relief be awarded to songwriters and composers based on copyright infringement, breach of contract and accountancy practices.
According to a statement from the attorneys for the plaintiffs, “On September 11, 2002, U.S. District Court Judge Dean Pregerson denied a motion to dismiss the class action lawsuit, Ory v. Columbia House Music Club, Case No. CV 02-02342 DDP, filed in Los Angeles, by composers against the two giant record clubs, Columbia House Music Club and BMG Direct Marketing, Inc.. The composers have alleged that the record clubs ‘infringe first and pay a reduced rate later,’ a most unusual business practice, and not allowed under the law of copyright. The composers estimate that the record clubs siphon over $100 million dollars a year from composers. ”
For film & television composers, it should be noted that this legal dispute includes the sale of feature film soundtracks and television music anthologies when offered to the public through the record clubs.
For further information about this lawsuit, contact attorneys Neville L. Johnson at 310-826-2410 or Maxwell Blecher at 213-622-4222.

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