Sony BMG will pay $750,000 in penalties and costs and reimburse
California consumers whose computers were harmed by anti-piracy
software on some CDs sold by the record company, California
officials said on Tuesday.
The agreement between Sony BMG and the attorneys general of Los
Angeles County and the state of California settles a lawsuit
charging that the company secretly embedded digital rights
management software on CDs that potentially opened the door to
The lawsuit alleges that Sony did not properly disclose
information about the software aimed at limiting the number of
copies consumers could make of their music.
Tom Papageorge, a head deputy district attorney for Los Angeles
County, said Texas filed a similar agreement with the courts on
Tuesday and he predicted the Federal Trade Commission and other
U.S. states would do the same over the next year.
He estimated Sony BMG sold about 12.6 million CDs with the
software nationwide between January 2005 and November 2005 and
about 930,000 in California. Sony stopped using the software when
officials brought the problem to the record company's attention,
Sony BMG, a joint venture of Sony and Germany's Bertelsmann AG,
said in a statement it was pleased to have reached agreements
with officials in California and Texas.
As part of the settlement that still must be signed by a judge
Sony BMG will provide refunds of up to $175 to California
consumers who can provide a description and documentation of
damage to their computers from the software, officials said.
The record company will also pay $750,000 in penalties and fees
to settle the case that accused Sony BMG of using false
advertising, unfair competition and unlawful computer intrusion.