A website that sold Beatles songs online for 25 cents apiece before they became legally available has agreed to pay record companies nearly $1 million to settle a federal lawsuit.
U.S. District Judge Josephine Staton Tucker signed off on the settlement between BlueBeat.com and music companies EMI Group PLC, Capitol Records and Virgin Records America on Friday. The judge ruled in December that the site violated the music labels’ copyrights and presented unfair competition.
A trial to determine how much BlueBeat owed the companies was scheduled to begin Tuesday in Santa Ana, Calif.
BlueBeat streamed and sold music by the Fab Four and other top-name acts, including Coldplay and Lily Allen, for several days before music companies sued to shut it down in November 2009. By then, the site had already distributed more than 67,000 songs by The Beatles.
The posting of Beatles songs came shortly after the release of the group’s re-mastered albums and a pricey box set. A year later, Apple Inc. announced with great fanfare that it was selling Beatles music on its popular music service iTunes.
Within the first week, more than 2 million Beatles songs were purchased online for $1.29 apiece and 450,000 albums were sold.
BlueBeat had denied wrongdoing, claiming owner Hank Risan had pioneered a method called “psycho-acoustic simulation” that resulted in unique versions of copyrighted music.
The judge rejected his arguments and explanations of his technique in her December ruling, noting that Risan’s recordings were based on copies of CDs that he had purchased.
Risan said the settlement amount was a fraction of what the companies sought. He said the site, which is still active but doesn’t have any Beatles music available, is still working to register copyrights for 800,000 recordings.
“So long as we pay royalties, we can stream their stuff all day and all night without a problem,” said BlueBeat’s attorney Archie Robinson.
“We basically settled the case for their attorney fees,” Robinson said. “I felt that was sort of an acknowledgement on their part that they don’t have the damages they claimed.”
Russell Frackman, an attorney who represented the recording companies, did not return a phone message seeking comment.
