CD Wow forced to pay €61 million in damages to Irish and British pop industry

"Internet retailer CD WOW has been ordered to pay the British and Irish pop industry €61 million in damages (£41 million stg). The Hong Kong based business had been illegally importing CDs and music DVDs from outside the EEA and selling them to Irish and UK residents, despite having given the court assurances it would stop.

This is the largest award ever made in favour of the BPI (British Phonographic Industry) and IRMA (the Irish Recorded Music Association) and sets an important legal precedent as the industry seeks to prevent the illegal importing of CDs.

Dick Doyle, director general of IRMA said ‘This is a significant legal victory for the Irish and UK record companies. Not only has CD WOW been undermining the legitimate business of both the record companies and retailers, flouting the law by continuing to import CDs and music DVDs from Asia at the expense of the musicians and the music industry that supports them, they have also avoided paying VAT.

Willie Kavanagh, chairman of IRMA, added ‘we promised the retail industry that we would take on this unfair competition and we have delivered on our promise’.

Stephen Fitzgerald, managing director of Golden Discs said ‘any judgement which levels the playing field for all physical and online retailers is a welcome one. The practices of parallel importing and exporting under the low value consignment relief scheme do not serve the industry, artist or consumer’.

The result today sends out a clear warning to those who indulge in illegal music practice, they will not be tolerated by the music industry who have made a commitment that they will do everything in their power to prosecute and go after any individual who indulges in any form of unlawful music practice be it illegal downloading, file sharing, counterfeiting or illegally importing music.

Hundreds of Irish and UK artists such as Snow Patrol, U2, Enya, Robbie Williams and Damien Rice are among the imported artists that CD WOW was illegally selling.

The UK High Court found CD WOW guilty in March of Contempt of Court, by breaching an undertaking it gave to the court in 2004 to stop illegally importing and selling CDs and music DVDs. The inquiry on the amount of damages to be paid was not due to be heard until July, however because CD WOW failed to co-operate with orders made by Mr Justice Evans in March, the judge decided not to wait and brought the assessment forward. He ordered CD WOW to pay stg£41m in damages.

Steps have now been taken to enforce the stg £41 million damages award, and the company’s Hong Kong bank accounts and assets have been frozen."