The Warner Music Group has confirmed it has received a subpoena from the US Department of Justice relating to the pricing of digital music.
As previously reported, it was revealed last week that the DOJ planned to follow up investigations initiated by New York Attorney General Eliot Spitzer into the agreements between the major record companies and the download platforms. Insiders say the legal men are concerned that so called 'favoured nation' clauses in those contracts, that mean major record companies enjoy the benefits negotiated by their rivals, violate US competition law.
In its latest filing with the Securities And Exchange Commission, the Warner Music Group confirmed that on 28 Feb they received a 'Civil Investigative Demand' from the DOJ which was aiming to clarify whether or not "pricing of digitally downloaded music violates Section 1 of the Sherman Act". The major, which says it will cooperate with any investigations, confirmed that the information sought by the DOJ was essentially the same as that already requested by Sptizer's office in New York.
The filing referred to the DOJ's investigation as being "industry-wide", implying that the other major record companies will have received the same subpoenas.
While we're on the Warner Music Group, one for fans of board news. Anyone? Warner have appointed one Michele J Hooperjoins to their board as an 'independent director'. Hooperjoins, a co-founder of Chicago based Directors' Council, will sit on the company's audit committee, and as an independent member of that committee will fulfil rules set by the New York Stock Exchange regarding the involvement of independent people in auditing roles in newly listed companies. So now you know.