The agreement ends one chapter in a public relations disaster for the entertainment company, which must still contend with a lawsuit brought against it by the state of Texas for violation of state antispyware laws.
With its approval of the deal, the court finalized a tentative agreement reached between Sony and the plaintiffs in December.
Under terms of the settlement, people who purchased XCP-protected CDs can apply for either a cash payment of $7.50 plus a free album download, or three album downloads, whichever they prefer.
"This settlement gets music fans what they thought they were buying in the first place: music that will play on all their electronic devices without installing sneaky software," said Electronic Frontier Foundation (EFF) Legal Director Cindy Cohn.
The claim process actually began back in February and provides anyone who purchased Sony BMG CDs that included First4Internet XCP and SunnComm MediaMax software with the same music without digital rights management (DRM). Some people are also eligible for additional downloads or a small cash settlement. Anyone who bought one of the affected CDs should start the claims process at http://www.eff.org/sony.
"Participating in the settlement is a way to show Sony BMG -- and the entire entertainment industry -- how important this issue is to you," said Cohn. "If you take the time to claim the product you deserve, maybe other music labels will think twice before wrapping songs in DRM."
The problems with the Sony BMG CDs surfaced last year when security researchers discovered that XCP and MediaMax installed undisclosed -- and in some cases, hidden -- files on users' Windows computers, potentially exposing music fans to malicious attacks by third parties. The infected CDs also communicated back to Sony BMG about customers' computer use without proper notification.
In addition to compensating consumers, Sony BMG was forced to stop manufacturing CDs with both First4Internet XCP and SunnComm MediaMax software. The settlement also waives several restrictive end user license agreement (EULA) terms and commits Sony BMG to a detailed security review process prior to including any DRM on future CDs.
More information from Sony about the class action lawsuit, including lists of CDs that included the software in question, can is available here.