What the smurf is "psycho-acoustic simulation"?
It's the way MP3 files are compressed. Bluebeat.com could be using the term in a different way, but basically the term psycho-acoustics concerns the way the human brain interprets sounds. Without further explanation, it appears they're claiming that because they made the original recordings into MP3s, they have created new versions. They could have done far more than run the recordings through an MP3 encoder, using other methods to simulate the Beatles, but I don't think the courts are going to care what software methods were used.
Psycho-acoustics is actually a large field of study, and it covers everything from the way Bose makes small speakers sound big (well, at least to non-audiophiles), to compressed music, to making better hearing aids, to military crowd control weapons.