Kazaa owner welcomes file-swap ruling - News - Communications

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This story was printed from ZDNet Australia.
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Kazaa owner welcomes file-swap ruling

By James Pearce, ZDNet Australia
April 28, 2003
URL: http://www.zdnet.com.au/news/communications/soa/Kazaa-owner-welcomes-file-swap-ruling/0,130061791,120274011,00.htm

The Australian-based owner of popular peer-to-peer program Kazaa, Sharman Networks, has welcomed a United States court ruling favouring file-sharing software, but is still evaluating its impact on its own legal battle with the music industry.

US federal judge Stephen Wilson ruled that peer-to-peer network creators Streamcast and Grokster were not liable for copyright infringements that occur using their software, a decision which overturns previous court rulings.

"Sharman Networks Limited, owner of Kazaa Media Desktop, applauds Judge Wilson's decision in his ruling that file-sharing software is legal," said a spokesperson for Sharman Networks in a statement. "Since acquiring Kazaa Media Desktop, Sharman Networks built it to be a legitimate, powerful and efficient distribution channel for rights managed content. Our legal team is currently evaluating the ruling's significance."

Sharman Networks representatives are scheduled to appear in Judge Wilson's court on Monday in the United States for oral arguments in plaintiff's motion to dismiss Sharman's counterclaims against the entertainment industry. Sharman, which is currently being sued by the music industry for allegedly assisting copyright infringers, claims that major entertainment companies have colluded to drive potential online rivals out of business.

Sharman has said it wants to set up a legal peer-to-peer music distribution system that reimburses copyright holders, but has been thwarted by music companies who refuse to contemplate such a system. Paid-subscription sites are now available, but services had to fight hard throughout 2002 to win music licenses, and the right to offer services such as CD burning.

Michael Speck, the manager of Music Industry Piracy Investigations, told ZDNet Australia the decision was a "serious concern".

"The decision has more to say about how the case against the respondents was run than the principles, in my view," said Speck. "Unless it's redressed by [law] or a more thorough prosecution it presents a blueprint for Internet infringement, and it's a serious concern."