As you may well have seen, with this CD-Wow story capturing a fair few headlines this morning, the damages the online CD seller have been told to pay the UK record industry is £41 million, which is quite a lot. As previously reported, the Hong Kong based etailer was accused of selling CDs sourced from cheaper wholesalers outside the EU to UK customers, in violation of UK copyright laws and a 2004 legal commitment made to UK record industry trade body types the BPI. CD-Wow bosses claimed any post-2004 incidents of them selling UK customers CDs sourced from outside the EU were isolated and down to human error, but the UK courts sided with the BPI, leading to last week's somewhat monumental damages ruling. The £41 million is made up of £37 million damages plus £4 million interest.
Needless to say, the boss of CD-Wow, Henrik Wesslen, said the ruling set a "dangerous precedent", while accusing cash rich major record companies of unfairly targeting his independent retail operation, and of relying on outdated copyright rules that ran counter to the emerging global market. He told reporters: "We are the little guys selling CDs to the UK market and they [the BPI] have picked on us for that reason. I fear what is happening is an attempt to use the combined brute force of the record industry to force the retailers and, in turn, our clients, to keep lining the pockets of the fat cat executives. It shouldn't matter whether we are buying from an official distributor in the UK, Europe or the Far East, what is important is that we are buying legitimate products from the record companies themselves".
As previously reported, BPI chief Geoff Taylor has welcomed the massive damages ruling, telling reporters yesterday: "CD-Wow is no consumer champion. The vibrancy of British music depends on a fair return on the investments that allow British talent to shine. This decision is an important step in ensuring that British music has a bright future".
The UK's Entertainment Retailers' Association, which represents most of CD-Wow's rivals, like HMV, Fopp and Amazon, also welcomed the ruling. Their Director General, Kim Bayley, told reporters: "It is vital that all retailers compete on a level playing field. Illegal imports threaten that level playing field and threaten British jobs".