Suit Accuses Capitol Records of Trying to Falsify Data : Entertainment: An ex-employee says the firm ordered him to bribe retailers to help move its albums up Billboard magazine’s sales chart.

A former manager for Capitol Records has sued the label, claiming that he was wrongfully fired for refusing to go along with a scheme that allegedly required him to bribe record retailers to submit false data for Billboard magazine’s album sales chart.

The allegations draw attention to the way the influential Billboard record charts are compiled and come amid new indications that the Justice Department is continuing a long-rumored probe into music industry influence over sales data that Billboard uses to rank the nation’s 100 best-selling albums.

In his 15-page lawsuit, filed last week in Los Angeles Superior Court, former Capitol Records special accounts manager Donald Newkirk alleged that Capitol and three other defendants tried to boost the chart position of the label’s albums by instituting a scheme called “Billboard priority calling.” The lawsuit alleges that as part of the scheme, Newkirk “was required to offer bribes to retailers in payment for their (making) false sales reports.” Newkirk is seeking unspecified money damages in the suit.

A spokeswoman said Capitol Records has a policy of not commenting publicly “on any pending litigation with former employees.”

A Los Angeles lawyer familiar with Newkirk’s claims as well as a source close to the Justice Department, however, say federal law enforcement officials have been looking into allegations that record companies have used gifts and money to bribe retailers to help boost an album’s chart position.

A Justice Department spokesman in Washington refused to comment. And major record retailers reached Thursday said they hadn’t received any Justice Department inquiries.

Billboard recently revised the way it compiles its charts. The magazine said it did so to give “a more accurate picture of consumer purchases.”

Billboard’s ranking of the top 100 pop music albums, based on weekly reports from about 200 record retailers around the nation, is consulted by thousands of radio station and record store officials and can affect an album’s retail sales and radio station airplay by showing whether an album is gaining or losing sales momentum.

Unlike many surveys reporting sensitive sales data, the names of Billboard’s reporting record retailers are not confidential and are widely known in the industry. They include such leading chains as Los Angeles-based Music Plus, Minneapolis-based Musicland and Sacramento-based Tower Records as well as dozens of mom-and-pop record stores.

However, officials of Music Plus and Musicland, the nation’s largest record retailer, said that since they compile sales data by computer, it is nearly impossible to influence their reporting of sales figures.

“There’s no human element involved,” said Shelly Tucker, director of purchasing at Music Plus’ parent company, Show Industries. “All we do is take it direct from the computer and fax it to Billboard.”

Geoff Mayfield, the head of Billboard’s chart operations, said he had no knowledge of any wrongdoing by Capitol but added that he has heard of instances of labels attempting to improve the chart positions of their artists’ albums, particularly with smaller retailers.

“We are quite aware of the fact that record companies try to get an edge,” Mayfield said. “A company might attempt to alter figures or influence a (retail) account to change their report to us.”

Mayfield said he has heard of record companies offering free concert tickets and additional advertising spending in exchange for retailers changing their sales figures.

In May, Billboard completed what it called “the most extensive retail panel revisions in the history of its charts.” The changes were made to give more weight to large record store chains that track album sales electronically and give less weight to smaller retailers that monitor sales manually.

Mayfield said the changes make it difficult, if not impossible, to influence Billboard’s charts today.