Spitzer's Probe Into Digital Music Price-Fixing Continues
February 15, 2006 at 4:09 PM (PT)
NEW YORK Attorney General ELIOT SPITZER has served WARNER MUSIC GROUP with a second subpoena in regards to the ongoing investigation into alleged price-fixing between the major labels and purveyors of digital downloads, the label revealed in a filing to the SECURITIES AND EXCHANGE COMMISSION (SEC) yesterday (2/14).
According to the filing, the label was served with the second subpoena on FEBRUARY 3 of this year. Both WARNER MUSIC and SONY BMG confirmed reports late last year that they had received subpoenas from SPITZER's office regarding an investigation into whether record companies and digital music sellers conspired to set wholesale digital download prices (see NET NEWS 12/27).
In the SEC filing, WARNER noted that the subpoena is part of an "industry-wide investigation as to whether the practices of industry participants concerning the pricing of digital music downloads violate Section 1 of the SHERMAN ACT [an anti-trust act]."
In the same filing, WARNER also stated that they are currently facing a civil lawsuit on the same issue. The case -- RICHARD FEFERMAN et al. v. UNIVERSAL et al. -- was filed on 12/29 in the SUPERIOR COURT OF CALIFORNIA. The WARNER filing says that the record company has been "named in a class action lawsuit brought by consumers based on the same subject matter as the Attorney General's request for information alleging conspiracy among record companies to fix prices for downloads."
This latest news from the SPITZER camp comes as ABC TV's PRIMETIME LIVE revs up to air BRIAN ROSS' report on the payola scandal tomorrow (2/16) night (10:30p, ET).