Embattled digital music provider BurnLounge unveiled changes to its business model in an effort to stave off legal action. The company will eliminate the "network marketing" element of its business, meaning members will no longer get rewards for signing up new users under the existing tiered membership structure.

Under the new model, BurnLounge store owners will receive a greater percentage of each digital sale made on their respective services.

Earlier this month, the Federal Trade Commission initiated legal action against BurnLounge by asking a federal court to shut down the operation, alleging it was operating a de-facto pyramid scheme.