On Monday, the owners behind BlueBeat.com agreed to pay EMI Group, Capitol Records and Virgin Records America a whopping $950,000 USD for selling songs for 25 cents--including tracks from the Beatles-- before they were authorized to be sold online through iTunes.
Last December a federal judge found Santa Cruz-based Media Rights Technologies (MRT) guilty of copyright infringement by allegedly selling "remastered" works from popular artists such as Radiohead, Coldplay, Bonnie Raitt and the Beatles back in 2009.
During the initial trial, MRT argued that its BlueBeat.com subsidiary didn't sell the actual songs. Instead, the tunes were re-recordings with an additional "artistic" technique called psycho-acoustic simulation. MRT assumed it wasn't violating any copyrights because it controlled the copyrights for the music sold on its website. MRT even attempted to register for copyright protection on the psycho-acoustic simulations technique.
"I authored the sound recordings that are being used by psycho-acoustic simulation," MRT boss Hank Risan wrote in an e-mail to the RIAA. "Psychoacoustic simulations are my synthetic creation of that series of sounds which best expresses the way I believe a particular melody should be heard as a live performance."
U.S. District Court Judge John Walker didn't buy the "technobabble and doublespeak," authorizing a restraining order and later an injunction that saw the tracks removed from the website. Now U.S. District Court Judge Josephine Staton Tucker isn't buying the excuse either, citing it as an "obscure and undefined pseudo-scientific language (that) appears to be a long-winded way of describing 'sampling.'" She thus ordered MRT to pay the three record labels $950,000 USD.
As part of the settlement, MRT must immediately cease in reproducing, distributing, publicly performing, or linking to any copyrighted works published by the three record labels involved in the case. MRT and BlueBeat have also agreed not to appeal the judgment. Unfortunately, that leaves the door wide open for an additional attack by the three labels who could seek damages that may have taken place after the injunction.
As of this writing, BlueBeat still offers copyrighted material from other labels. "BlueBeat transmits simulated live musical performances for free at 160 and 320 kb/s," the site reads.