Here's the situation: Activision paid to use the song "What I Like About You" by The Romantics on the game Guitar Hero Rocks the 80s. Like many songs where it didn't have access to or didn't pay for the master track, Activision had its team of talented studio musicians re-record the song for inclusion in the game. The Romantics sued because the new version of the band's song sounded too close to the original–which was the point all along, really, but this way The Romantics get more money.
The whole thing smelled bad, and on Monday a federal judge denied the request to stop sales of the game. According to the announcement, the judge "indicated that to the extent there were any copyright issues, Activision did exactly what the company was supposed to do in developing the product."
It's been pointed out that this sort of sound-alike recording is protected under law, and is, in fact, encouraged. The law states that the original copyrights of a song "do not extend to the making or duplication of another sound recording that consists entirely of an independent fixation of other sounds, even though such sounds imitate or simulate those in the copyrighted sound recording."
This played out exactly like most people assumed it would, and The Romantics ended up looking a little sad as they tried to squeeze a few more bucks out of the use of the band's song. We know that having your music included in Guitar Hero games leads to a measurable increase in digital sales, so why not just enjoy the publicity and the new market you're reaching? Hopefully, this ruling will keep other bands from trying this again, and the music business will begin to embrace these games as a way to break in new bands and renew interest in existing songs.
Court records don't indicate if The Romantics pleaded their case in awesome red suits.