Judge Rejects Complaints Over $25 Million Settlement in MoFi Class Action Suit

A judge has rebuffed complaints over the proposed settlement reached in the Mobile Fidelity Sound Lab (MoFi) class action lawsuit, which sprung out of a major audiophile controversy last year.

Last summer, MoFi came under fire for its “Original Master Recording” and “Ultradisc One Step” vinyl series, which the company said were made from either original master recordings or analog tapes. But in July 2022, a record store owner in Phoenix shared a video on YouTube claiming MoFi was actually using digital files to make its records. 

Though there was some initial pushback, engineers at MoFi eventually confirmed the allegations, sending shockwaves through record collector circles. Albums made from analog tapes or original master recordings are considered to sound better than those that incorporate digital files into the mastering process because the former are as close to the original audio recording as one can get. A class action lawsuit filed in Aug. 2022 argued that even the most advanced, high-quality analog-to-digital transfer “diminishes the quality and collectability compared to all-analog recordings.” 

Earlier this year, MoFi and the plaintiffs reached a settlement expected to be worth about $25 million that offered customers a few routes to recompense: They could get a full refund for any eligible records they purchased or keep the albums and take either a 5% cash refund or a 10% MoFi credit refund. (The reason some may want to take the partial refund? Despite the audio quality concerns, it’s been noted in court documents that many of these MoFi releases now “have a value on the secondary market that exceeds their original purchase price.”)

After the settlement was reached, however, a few plaintiffs filed a motion complaining the deal was unfair and provided “inadequate relief.” They also took issue with the lawyers tapped to negotiate the settlement, claiming the proposed settlement was the product of a “reverse auction” — basically alleging that MoFi went looking for “ineffectual” class lawyers who just wanted a fee and would negotiate a more favorable settlement. 

However, the judge overseeing the case rejected all of the intervenors’ arguments. He called the proposed settlement itself “fair, adequate, and reasonable” and said there was no evidence of “reverse auction” collusion with the lawyers who negotiated with MoFi (and that the fees they collected did “not appear to be overly-generous or disproportionate to the relief allocated to the class.”)

MoFi’s lead counsel, Joseph J. Madonia tells Rolling Stone, “As always, MoFi continues in its commitment to provide the best-sounding records and listening experience possible. We appreciate the Court’s decision that there was no collusion, improper activity, or reverse auction in reaching a very fair settlement.”

Duncan C. Turner, the class lawyer who negotiated the settlement with MoFi, shared a statement with Rolling Stone: “We are pleased that Judge Robart granted preliminary approval to our settlement over the objections of the intervenors. There was never any substance to the intervenors’ made-up collusion story.  The settlement terms are sound and fair, so we will be turning our attention to executing the notice program and getting the class members their compensation.”

Lawyers for the intervenors did not immediately return a request for comment.

This story was updated 5/12/23 @ 12:48 p.m. ET with a statement from MoFi’s lawyer.