A PYMNTS Company

US: Sony Music investigated for alleged collusion

 |  July 7, 2016

The music major responds that the suggestion of antitrust violations are “nothing but speculation and conjecture” and pretext for avoiding $17 million claims plus allegations of fraud.

When Rdio declared Chapter 11 bankruptcy in November 2015, the event marked a blight on the music industry’s transition from downloads to streams. Losing $2 million each month, Rdio announced it would be selling its key assets to Pandora for $75 million.

Distribution of the proceeds has been contentious. Sony Music is still grumbling about what happened on the brink of Rdio’s bankruptcy and believes it is being shortchanged. Now, Rdio wants to put Sony on the defensive.

The Hollywood Reporter reported that Rdio has retained the prominent law firm of Winston & Strawn to investigate Sony on the antitrust front. Rdio has recently told a bankruptcy judge it has “potentially highly valuable claims” against Sony for allegedly colluding with Universal and Warner Bros. in the streaming music market.

If Rdio moves forward with an antitrust lawsuit as currently being envisioned, it would be raising similar issues explored in the Justice Department’s lawsuit against Apple and book publishers over the way that “most favored nation” clauses in contracts can enforce pricing floors for the licensing or sale of content.

Full Content: Hollywood Reporter

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