The RIAA filed suit to enjoin the manufacture and distribution of the Rio PMP300, one of the first portable MP3 players, because it did not include the SCMS copy protection required by the act, and Diamond did not intend to pay royalties.
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The act enabled the release of recordable digital formats such as Sony and Philips' Digital Audio Tape without fear of contributory infringement lawsuits.
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The impasse was broken at a meeting in Athens in 1989, when representatives from the recording industry and the consumer electronics industry reached a compromise intended to enable the sale of DAT recorders in the United States.
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A year later the songwriter Sammy Cahn and four music publishers, unhappy with the absence of a royalties provision in the Athens agreement, filed a class action copyright infringement suit against Sony.
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