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Thursday, January 09, 2003
 Few Claiming CD Settlement Money
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Message Text: Suppose someone was handing out $20 bills and almost nobody wanted one? That's roughly what's happening with a massive price-fixing settlement involving states and compact disc companies. The deal calls for payments of as much as $20 for customers who bought CDs between 1995 and 2000. But so far, only a few people have signed up, and officials fear the money will go begging.

In September, the five top U.S. distributors of compact discs and three large music retailers agreed to pay $143 million in cash and CDs to settle allegations they cheated consumers by fixing prices.

The lawsuit alleged that the companies — upset with low prices charged by some stores — conspired with retailers to set music prices at a minimum level, effectively raising the retail prices consumers paid for CDs.

Part of the settlement — about $44 million in cash — is earmarked to pay customers from $5 to $20, depending on how many people wind up dividing the money.

By the end of December, only about 30,000 people nationwide had applied for a piece of the pie, a tiny fraction of the number the settlement could handle.

"The response thus far has been fairly abysmal," said Washington Attorney General Christine Gregoire, who's been on morning radio shows to promote the settlement.

Gregoire was among the attorneys general of 41 states and commonwealths who accused record companies of conspiring with music distributors to boost the prices of CDs between 1995 and 2000.

The companies settled rather than wage a costly legal battle.

The settlement's Web site has been up for a month, and legal notices have been published in TV Guide, Parade and other national magazines, but the response rate has been very low, said Tina Kondo, a senior assistant attorney general in Gregoire's office.
 
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