Artists Will See Little of LimeWire Settlement

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Old 23-May-2011
Post Artists Will See Little of LimeWire Settlement

Despite the fact that three largest record labels had claimed earlier that part of the LimeWire settlement would be shared with artists, it seems like this won’t happen. The reason for this is that when the RIAA deducts the cost of the long-lasting litigation, the performers will see little, if any of the $105 million LimeWire settled for.

Right after the Recording Industry Association of America and LimeWire have agreed to $105 million settlement a week ago, the industry observers started to question how the received money would be divided.

The music industry celebrated the victory in this copyright infringement case a year ago, when US District Judge ruled that both LimeWire and its founder are responsible for copyright violation, unfair competition, and encouragement of the others to violate the law. Throughout the 5 years of litigation, the plaintiffs repeatedly claimed that LimeWire substantially harmed artists, which makes it seem natural that the artists should be given some of the settlement money in order to be able to make up for the damages. However, this might never happen.

In fact, the Recording Industry Association of America didn’t comment on the scheme of the settlement distribution. But traditionally, the record labels shared litigation recoveries. For example, they did it with the KaZaa settlement, and 3 of 4 major record labels – EMI, Universal Music, and Warner Music promised to do so with the LimeWire’s $105 million. However, longtime lawyers for performers admit that the artists still haven’t received much. Although all the labels claimed they were already sharing the settlement money, the artists’ lawyers deny this fact and point out that the record companies are good at transferring money around making it impossible for performers’ managers to find it.

The most likely scenario, according to the industry observers, is that the entertainment industry will as usually deduct the cost of litigation, which covers 5 years of courtroom meetings with dozens of lawyers, and only after this the remainders will be forwarded to the labels. In other words, the majority of artists will not see a penny left from the LimeWire settlement. Perhaps, the musicians accounting for sizable sales will see some from the labels in the end. So, it’s just another long-lasting battle that made lawyers the winners, but neither industry nor artists.

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