PORTLAND – A complex legal case in which the music industry stands accused of artificially inflating the price of compact discs has landed before a federal judge in Portland.

A federal judicial panel assigned the case to U.S. District Judge D. Brock Hornby, who will oversee a set of lawsuits brought by 42 states and dozens of consumers against major CD distributors and retailers.

Maine’s attorney general and several of Maine’s top law firms are taking leading roles in the case. At stake are hundreds of millions of dollars.

The case is the most far-reaching to be argued in Maine in recent memory. The pretrial stage alone is expected to last at least a year and generate millions of pages of court documents. After that, trials could commence in Maine or in other federal courthouses around the country.

“This is a reflection of the federal court’s view of Hornby as somebody capable of handling complex multidistrict litigation,” said Peter Rubin, a Portland lawyer representing plaintiffs in the case. “It’s exciting to have this come to Maine and to be a part of it.”

The basic allegations in the various lawsuits are the same. The plaintiffs claim that since 1995 consumers who bought CDs by Santana, Madonna, Bob Dylan and many other recording artists paid artificially high prices.

In documents filed with the court, plaintiffs allege that CD distributors entered into unlawful agreements with retailers in order to eliminate discount CD sales. The agreements allegedly came to light after some discounters such as Best Buy and Circuit City began offering CDs at low prices to lure customers. The average price of a CD allegedly dropped from about $15 to about $10.

To push the price back up, distributors instituted minimum advertised pricing policies, the plaintiffs allege. The policies penalized retailers for selling CDs at discount prices. Distributors would pull back from shared advertising ventures, an action that could cost retailers hundreds of thousands of dollars.

After a two-year investigation, the Federal Trade Commission concluded that the music industry engaged in unlawful restraint of trade that cost consumers as much as $480 million.

In May, the FTC entered into a consent agreement with the nation’s five largest CD distributors. The distributors, while not admitting any wrongdoing, agreed to stop their minimum advertised pricing policies.

Two months later, in federal court in New York City, attorneys general from across the country filed their lawsuit against the industry.

Defendants include the five major CD distributors – Universal Music, Capitol Records, Sony Music, Warner Music and BMG Music. Also named as defendants are retailers MusicLand, Tower Records and Trans World.

Representatives of some of the distributors have stated in the past that, while they engaged in minimum advertised pricing policies, the policies are not illegal.

The number of lawsuits against the music industry continued to pile up throughout this summer and fall. Dozens of private class-action lawsuits were filed in courts throughout the country.

A federal judicial panel decided to send all the cases, including the one filed by the attorneys general, to one judge to ensure that numerous federal judges weren’t presiding over the same matter.

Lawyers involved in the case are scheduled to meet in Hornby’s courtroom Jan. 31 for the second of what will likely be many pretrial conferences.