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For Immediate Release:  
For Further Information:
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December 21 2006  
Lee Moore
609-292-4791

Office of The Attorney General
- Stuart Rabner, Attorney General

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Attorney General Announces Settlement with SONY/BMG to Resolve Secret Software Case
Firm Will Pay Restitution for Computers Harmed by Software
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Trenton - Attorney General Stuart Rabner announced today that SONY BMG Music Entertainment will pay at least $4.25 million as part of an agreement with New Jersey and 39 other states that grew out of allegations the company placed secret anti-copying software on millions of CDs that harmed computers and made them vulnerable to hackers.

Under terms of the multi-state agreement, known as an Assurance of Voluntary Compliance, SONY BMG will provide refunds of up to $175 to consumers who spent money to repair computers damaged by the software. Consumers will have 180 days to file a refund claim, which must be submitted on a form which will be available on the SONY BMG website (www.sonybmg.com).

The company agreed to pay $4.25 million to resolve the states’ investigation. New Jersey will receive $313,000.

During 2005, SONY BMG distributed more than 12 million CDs with two kinds of anti-copying software, but did not inform consumers on the CD boxes that the CDs contained anti-copying software, or Digital Rights Management (DRM) software. The software was intended to restrict consumers’ ability to copy music, but was designed so that consumers did not know that the anti-copying software was downloaded onto their computers. One version of the software was called XCP and created vulnerabilities on Windows-based computers by exposing them to security problems, including viruses.

When consumers did discover XCP, they experienced problems when they tried on their own to remove the software without using a specific uninstall program that was later provided by SONY BMG.

“Music producers are within their rights to protect their music,” Attorney General Rabner said. “But not informing consumers about anti-copying software, and using software that damaged their computers violates consumers’ rights.”

The multi-state agreement provides that SONY BMG will not include DRM software that is downloaded or copied to the hard drive unless it is disclosed to the consumer. Specifically, SONY BMG will be prohibited from using XCP or Media Max DRM software in the future, and will limit the ways in which SONY BMG may use other anti-copying software in the future. If it does choose to use DRM software in the future, SONY BMG must inform consumers about it.

In addition, the multistate agreement states that SONY BMG must clearly inform consumers if the music CDs they purchase contain an enhanced feature that connects to the Internet when the CD is inserted into the computer. SONY BMG must obtain a consumer’s consent before connecting the consumer’s computer to the Internet.

Deputy Attorney General Geoffrey R. Gersten represented New Jersey in this matter.

>> Assurance of Voluntary Compliance or Discontinuance (1.78mb pdf)

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