BlueBeat claims that it pays royalties to SoundExchange, and that prior to the site's launch in 2004, it entered into confidential agreements with major recording labels, including EMI, which allowed the labels to evaluate if BlueBeat contained copyrighted material. BlueBeat says that the entire Beatles catalogue was on its site during the EMI evaluation but they "made no objection to its inclusion."
EMI denies that BlueBeat has ever paid any royalties for its songs, and charges that the 25-cent MP3 sales offered by the Web site "has the potential to destroy [EMI's] ability to sell, lawfully exploit, or otherwise control their sound recordings" in addition to the relationships EMI has built with licensees and artists.
The two sides were scheduled to meet in court Friday.
