
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: FRIDAY, August 6, 1993                   TAG: 9308060087
SECTION: BUSINESS                    PAGE: B7   EDITION: METRO 
SOURCE: LAURENCE HAMMACK STAFF WRITER
DATELINE:                                 LENGTH: Short

4 MAJOR MUSIC DISTRIBUTORS SUED

A Roanoke record store is joining in accusations that four music distributors are conspiring against sellers of used compact discs "to maintain their prices for new CDs at artificially high" rates.

The Record Exchange of Roanoke Inc. is part of a class-action lawsuit filed this week in U.S. District Court in California.

The lawsuit accuses four major music distributors - Capitol/EMI labels, Columbia/Epic, MCA and Warner/Electra/Atlantic - of price fixing and unreasonable restraint of trade.

According to the suit, the four distributors are eliminating advertising support for sellers of used CDs, such as the Record Exchange.

"What we have is one industry trying to eliminate another industry that is trying to compete with them," said Don Rosenberg, president of the Charlotte, N.C.-based Record Exchange chain, which has stores in Blacksburg, Roanoke and Salem.

If distributors of new CDs are successful in defeating the used-CD trade, Rosenberg said, CD prices could rise to as high as $20. New CDs now sell for about $13 to $15. Used CDs sell for about $8.

The Record Exchange, which sells both used and new CDs in 14 stores throughout Virginia and North Carolina, has not received advertising money from the distributors since May.

Distributors also have threatened to withhold new releases as long as the stores continue to sell used CDs at lower prices, Rosenberg said.

The Record Exchange is joining the lawsuit with the Independent Music Retailers' Association, a group co-founded by Rosenberg that represents several hundred music stores nationwide that sell used CDs.

by CNB