suraj.sun writes "A federal lawsuit against the major music labels calls them a cartel which has banded together illegally to fix the prices of digital music. A New York appeals court has ruled the case can proceed.
As lawsuits go, this one's a humdinger, charging that the labels engaged in a price-fixing conspiracy to ensure that they each made about 70 cents per track sold online, and that no one received a better deal than anyone else. The case had earlier been tossed for a "failure to state a claim," but the Second Circuit Court of Appeals has reinstated it and ordered the trial judge to proceed with the case.
Most Favored Nations
The case in question, Starr V. Sony BMG, actually began life as a host of cases filed by various plaintiffs in various state and federal courts in 2005 and 2006. The cases were eventually consolidated into a single one to be heard in a New York federal court, and that case covers behavior that goes all the way back to those dark post-Napster days when the labels attempted to foist MusicNet and pressplay onto an unsuspecting public.
Those early services were at first the only way that the labels would allow their music to be sold over the Internet, and the control exercised was extreme: they were actually label-controlled ventures, neither store had a complete selection of music, and the DRM was flat-out ridonkulous.
ARSTechnica : http://arstechnica.com/tech-policy/news/2010/01/digital-music-prices-are-they-illegally-fixed.ars"
Link to Original Source