Lime Wire’s Antitrust Charges Against RIAA Dismissed

The Federal courts seem to be inclined to side RIAA (Recording Industry Association of America) when it comes to p2p file sharing networks. Yesterday U.S. District Judge Gerard E. Lynch in New York ruled that Lime Group LLC failed to make its case that it has been harmed by the recording companies (RIAA’s) business practices and he granted the recording companies motion to dismiss the claims. Read here.
The background of this case is that RIAA brought a lawsuit against Lime Wire which is a file sharing applications provider in August 2006 for copyright infringement over songs distributed over the Internet without permission and claimed that this mode of sharing music was an illegal business model. Lime Wire’s defense is that they were not “actively inducing” copyright even if their software product was used for it and Lime Wire in turn filed an antitrust law suit against the recording companies stating that RIAA was trying to illegally compete with Lime Wire and other file sharing systems.

Judge Lynch concluded Lime Group didn’t show any facts to suggest the record companies’ actions were “anything other than independent decision-making by each company to refrain from doing business” with Lime Wire.

Lime Group had also contended the recording companies had fixed prices for online music, but Lynch concluded that the firm failed to establish it had been harmed by any alleged price fixing. Lynch also rejected claims by Lime Group that the record labels had engaged in unfair business practices, including hacking the firm’s file-sharing network and claiming it promotes child pornography, on the grounds that the alleged actions were not anticompetitive. The original case against Lime Wire by RIAA is still pending and it was the first piracy lawsuit brought against a distributor of file-sharing software after the U.S. Supreme Court ruled in 2005 that technology companies could be sued for copyright infringement on the grounds they encouraged customers to steal music and movies over the Internet. Read here.

It will be interesting to see how the court decides the original law suit against Lime Wire after the Federal court in the Capital Records v Jammie Thomas case held that the defendant was held guilty of copyright infringement for distributing songs over KaZaA another p2p file sharing system. Read my earlier post here.

Copying and Distributing Music on the Internet

The verdict was out three days ago in the Capital Records v Jammie Thomas case and the defendant was held guilty of copyright infringement. The RIAA (Recording Industry Association of America) has been suing people for copyright infringement for a while but they were all dismissed or settled out of court for about $4000-$5000 per defendant, but this is the first case that actually went to trial.

According to the plaintiff’s counsel Richard Gabriel the crux of the matter was ”copyright infringement over the Internet” and that the defendant knowingly infringed the laws by distributing songs over KaZaA and said that “Downloading and distribution doesn’t happen by accident.” In the jury trial  it was held that the defendant Jammie Thomas was guily of copyright infringement and was ordered to pay RIAA a total of $222,000.00 calculated as $9250.00 for each of the 22 songs that was infringed. This is the first time RIAA has won a jury verdict against an accused file sharer.

Now none of this money will go to the artists but will only embolden RIAA to aggressively sent out more threats to sue individuals. Defendant Thomas announced that she has decided to appeal the verdict which basically held that “making sons available on-line violates copyright.” This maybe temporary victory for RIAA but is definitely not going to stop the sharing of music,  for each person who is sued there will be thousands who will continue the music sharing trend and get away with it.