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Another Music Lawsuit, but with an Unexpected Target

Thursday, 2 Jul 2009 | 3:57 AM ET

It's not surprising that there's yet another lawsuit claiming copyright infringement in the music industry. But it is surprising that this latest suit doesn't attack typical pirates, but companies that actually run paid online music subscription services.

A consortium of 13 music companies is suing Yahoo , Microsoft and RealNetworks . The claim is that these music services play their songs without obtaining copyright permission and without paying the fee. MCS Music America, which represents the 13 companies and says it administers some 45,000 tracks, is demanding that each of the infringed songs be removed AND demanding $150,000 per act of infringement.

How much are they looking for? A lot; the court filing includes 90 pages that list tracks the company says were infringed. And MCS says they're not just looking for $150k a pop, but rather for that much every single time one of those songs was illegally downloaded or streamed. That seems aggressive, to say the least. I'm also surprised that these companies aren't asking to be fairly compensated for their songs moving forward, they want the tracks to be taken down, period.

How did this happen? You'd think that Microsoft, which knows something about lawsuits, would do its homework and pay for the content. Well they might have. It's possible that these companies licensed the rights to the recordings, but not the publishing rights — the rights to the compositions. We'll see what the court decides. I'd predict some sort of settlement.

Questions? Comments? MediaMoney@cnbc.com

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  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.