A judge announced the court-approved negotiated settlement which represents both damages and legal fees.
The action began in January 1999 when Universal, Warner, BMG, EMI and Sony filed a lawsuit challenging MP3.com's copying of thousands of copyrighted CDs onto its file servers to create its My.MP3.com “locker” service. MP3.com has agreed not to appeal the judgement, having now settled with all major record companies.
Universal has also granted MP3.com a non-exclusive, North American license for the use of its on-line services.
Zach Horowitz, President and Chief Operating Officer of Universal said:
“Although we believe our proof at trial would have led to a greater damage award, we are satisfied with the award. It was never our intent to put MP3.com out of business with a judgement so large that it would threaten their viability as a company. We support the development of legitimate music businesses on the internet.”
Universal has said it will give its artists half of the damages awarded. The settlement terms reached with each of the other four major record labels is reported to involve payment to them of around $20 million plus royalties. MP3.com said after yesterday’s settlement that the total sum payable to all five companies is within its $170 million budget set aside for legal costs. Some smaller record labels bringing actions have not yet settled with MP3.com.