The end of cheap CD and DVD imports moved a step nearer as the
British
Phonographic Industry (BPI) today announced the UK record industry has been
awarded a substantial sum in damages against online retailer
CD
Wow.
The award of over £41m is the culmination of a long-running feud between the
BPI and Hong Kong based CD Wow over cheap imports of CDs and music DVDs into the
UK from Asia.
The BPI said these imports were illegal and undermined the legitimate
businesses of UK retailers and record companies.
BPI chief executive Geoff Taylor said: "CD Wow is no consumer champion; it is
a rogue trader that now has to face the consequences of its actions.
"We have an extremely competitive record industry and retail sector here in
the UK and at an average price of around £8.50, CDs are better value than ever.
"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 six-year fight lead to a number of court battles. In 2004 CD Wow dropped
its defence in court proceedings at the eleventh hour and agreed to stop
parallel importing and paid hundreds of thousands of pounds to the BPI.
According to the BPI, this undertaking was ignored and the retailer continued
to import cheap CDs into the UK. In February this year CD Wow admitted in the
High Court to 33 breaches of copyright law in contravention of this previous
undertaking to the UK courts.
It said that it was a result of "human error" but this didn’t appease the
BPI. It took the case back to the High Court and Judge Evans-Lombe made the
award of over £41m.
BPI general counsel Roz Groome, who spearheaded the industry's six-year case,
added: "CD Wow have consistently broken the law, ignored High Court rulings, and
have continued to trade illegally throughout.
"Clearly the courts have lost patience with this rogue retailer and the
message is clear; any company seeking to engage in this type of illegal trade
will face the toughest sanctions."
The BPI said has already begun taking steps to enforce the damages award,
having obtained a freezing order on the retailer's Hong Kong bank accounts and
assets. It is recognised that enforcement of the award will be time-consuming
and complex given that the company's assets are located in a number of
jurisdictions.
"The BPI will use this landmark ruling to take firm action against any other
retailers that import illegally."
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