Out-Law / Your Daily Need-To-Know

MP3.com said yesterday that it will pay up to $30 million to music publishers with a view to settling legal action against it if a provisional agreement reached with a trade organisation is given final approval by its member and the courts.

The US National Music Publishers' Association and its licensing subsidiary, The Harry Fox Agency, and MP3.com announced their agreement yesterday.

Under the terms of the deal, MP3.com will have use of numerous music tracks on its My.MP3.com service which allows consumers to listen to music from CDs that they already own or which they purchase from MP3.com's retail partners.

A US court recently ruled that the company wilfully infringed publishers' copyrights when it launched the service. MP3.com settled its case with four out of five major record labels, but did not reach a settlement with Universal Music Group. It has been ordered to pay damages to Universal of between $118 and $250 million. MP3.com has said it will appeal this ruling.

The proposed, 3-year licensing arrangement announced yesterday provides that MP3.com will pay up to $30 million for the benefit of up to 25,000 music publishers and their songwriter partners as part of two equal funds. One fund will be used to pay for past uses of music on the My.MP3.com service. The other will provide advance payments toward royalties earned under the prospective license. The number of potential songs licensed to MP3.com by the music publishers could exceed one million.

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