1st March 2012

Global independent music rights agency Merlin agrees groundbreaking Settlement With LimeWire

First time independents have participated in settlement of copyright infringement claims against a global peer-to-peer service

The global independent music rights agency Merlin has settled a long running copyright infringement claim on behalf of its members against the now defunct peer-to-peer service LimeWire. The settlement was reached out-of-court subsequent to a lawsuit filed by Merlin in July 2011.

Merlin’s settlement follows the major record labels’ announcement that they reached a $105 million out-of-court settlement with LimeWire in May 2011.

Merlin’s members’ claims against LimeWire were settled for an amount commensurate with the major record labels’ settlement taking into account the aggregate market shares of the Merlin members relative to the major labels’ shares and costs of action. Merlin will pay out the proceeds of the settlement to its members shortly.

With its members’ market share in the US alone reported at around 10%, Merlin represents by far the largest and most compelling basket of global independent rights in the world. For services wishing to launch with the most complete musical offering for their consumers, Merlin represents enormous value in streamlining the licensing of this repertoire, which could otherwise involve hundreds of individual negotiations. This settlement is testament to both Merlin’s diligence in protecting its members’ rights and the value of its member labels’ repertoire.

Labels such as Epitaph, Merge, Warp, Yep Roc/Red Eye, Naïve, Naxos, Tommy Boy, One Little Indian, Kontor, Secretly Canadian, Beggars Group, [PIAS] Group,!K7, Sub Pop, Domino and Koch/E1 are all members of Merlin.

Said Charles Caldas, Merlin CEO: “It is deeply satisfying to announce this settlement today. The exclusion of independents from past major settlements such as Kazaa was a key factor in the formation of Merlin, and I am proud to say that this time, via the actions of Merlin, our members’ rights have been properly protected. We will continue to do everything we can to ensure that the labels we represent are never again left out in the cold”.

Said Charlie Lexton, Merlin Head of Business Affairs & General Counsel: “Whilst this is by no means the first settlement Merlin has delivered its members, it is clearly the most significant, representing as it does, the successful conclusion of a high profile, large scale, global copyright infringement claim on an equal footing with the major labels. An unprecedented moment for independents”.

Said Martin Mills, Merlin Chairman: “Following on the heels of what happened, or didn’t happen, with Kazaa, this is a brilliant and fair result for Merlin’s members collectively that could never have been achieved individually, and a great tribute to Merlin”.

Notes for Editors

About Kazaa

The Kazaa case and $115m settlement was characterized as an industry action/settlement – see: here, yet it was in fact for the benefit of the major record companies only.

About Merlin

Merlin represents the world’s most important set of independent music rights. Merlin commenced operations in May 2008. Since then it has struck deals with a large number of digital services including Spotify, YouTube, Google Music, Rdio and Simfy and reached a number of copyright infringement settlements on behalf of its members with amongst others XM Sirius and Grooveshark. Merlin seeks to ensure its members have effective access to new and emerging revenue streams and that their rights are appropriately valued and protected.

Merlin represents by far the largest and most compelling basket of global independent rights in the world, and so offers the most efficient means of licensing this repertoire. Members include Warp Records, Epitaph, Naïve, Tommy Boy, One Little Indian, Yep Roc/Red Eye, Kontor New Media, Beggars Group, Merge, !K7, PIAS, Domino and Koch/E1. Their artists include Adele, Arctic Monkeys, Vampire Weekend, Arcade Fire, The XX, Neko Case, Spoon, Grizzly Bear, The National, Tom Waits, DJ Khaled, Dorrough, Tiësto, Scooter and many many more.

A global organization, its members’ market share in the US alone is reported at around 10%, equivalent to that of the smaller major labels, whilst in Europe member labels released 72% of the top 60 independent albums released in the past three years and commanded a 11% digital UK market share in 2009. Most recently, streaming service Spotify publicly announced that Merlin repertoire represented over 10% of the usage on its service.

IMPALA – Independent Music Companies Association

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