From MusicBrainz Wiki

Gracenote: eminent domain over the public domain

Owners of the CDDB and related trademarks and copyrights, as well as a number of software patents related to music metadata lookup, Gracenote (a subsidiary of Escient, a media player manufacturer) took a database that had been built by music fans and turned it into a private company.

In addition to their appropriations, Gracenote has engaged in typical corporate behavior by suing various competitors (like MusicMatch) and even customers (like Roxio, which allowed users to switch to FreeDB). The MusicMatch case is still in progress; there was a preliminary ruling in October 2004, discussed in this thread on the MailingList. The Roxio suit (described in this CNET article) was settled for an undisclosed amount in 2001.

There's a pretty biased article in Wired on the origins of Gracenote that glosses over the appropriation of the CDDB database (although they do quote Robert Kaye and mention MusicBrainz, they don't even bother linking to us, only linking to Gracenote, the RIAAIdea.png, Escient, and FreeDB). More embarrassingly for the corporate Goliath, another Wired article puts the lie to their claims of accuracy and editing the data.