Welcome to the Department of Justice, Iowa Attorney General Tom Miller

For immediate release -- Thursday, March 13, 2003.

Contact Bob Brammer - 515-281-6699

110,000 Iowans Filed for CD Payments

Iowans filed at the fastest pace in the nation. Refunds are likely to be over $12 per person -- or more than $1.3 million to Iowans overall.

DES MOINES. Attorney General Tom Miller said today that 109,994 Iowans filed online claims for a refund in the "CD" compact disc antitrust case. The filing period ended last week. [Updates as of September and October 2003: Additional appeals delayed distribution of funds, but likely will not prevent the payments. See footnote with details below.*]

The refunds will be made in connection with an antitrust case filed by states alleging that major music distributors and retailers illegally kept CD prices artificially high for several years.

The claims report dated March 12 indicates that over 3.5 million Americans filed claims for refunds before last week's deadline. About 97% of claims were filed online, the others by mail.

Iowans filed about 3.2% of all online claims filed nationwide, compared to Iowa's 1% share of the nation's population. "Iowans filed at a faster clip than anywhere else in the nation," Miller said. "Our news media did a great job telling Iowans about this excellent opportunity."

If valid claims hold at about 3.5 million nationwide, the refund amount will be about $12.50 per person -- or over $1.3 million overall to Iowans. The claims administrator for the project still must validate claims and eliminate duplicates. After that, the results must be presented for approval to the judge handling the case. [For status of payments, see footnote below.]

There was a huge influx of claims filed online during the last two weeks, including more than 600,000 nationwide and over 34,000 by Iowans since the Feb. 24 report. Iowa ranks 31st in population (counting Puerto Rico), but only ten much larger states filed more CD refund claims.

The payments result from settlement of an antitrust case in which Iowa and other states alleged that the nation's top distributors of recorded music and three large retailers entered into illegal conspiracies to maintain minimum prices for CDs and other recorded music. The suit alleged the defendants acted illegally to stop other retailers from offering CDs at discount prices. The States' action was aimed at restoring competition in the industry.

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* Update as of September 2003:

The District Court approved the process and release of funds after the close of the claims period. However, several appeals were filed at that time challenging various aspects of the Court's order. The appeals are holding up further administration of the settlement and payment of claims because of the possibility that the Appellate Court might order that aspects of the settlement be changed or re-evaluated.

We still expect that Iowa claimants will receive about $12 apiece when funds are distributed. The States and other parties are pressing for an expedited appeal process, and the court at this point appears receptive to that proposal. This web site (www.IowaAttorneyGeneral.org) will be updated as new information develops about the payment of claims.

** Update as of December 2003:

All but one of the appeals have been dismissed. (None of the appeals were by major parties in the matter -- the music industry or the states -- and the remaining appeal is by an inmate in a Georgia prison.) The appeals delayed the refund process a little but did not derail it. We still fully expect payments will be made, we just cannot predict when.

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