Project Playlist-iMeem merger rumors persist

File this one as improbable, but it's interesting that this rumor continues to crop up. Project Playlist, a little known start-up with 9 million monthly visitors, is supposedly kicking the tires on social media site iMeem, according to music industry sources.

The alleged acquiree, iMeem, which has 20 million monthly visitors, denied the rumors are true. "Project Playlist buying us is like us buying Apple. This is just not accurate," said Matt Graves, iMeem's spokesman and a longtime straight shooter.

So why is this acquisition scenario still being passed around the music industry?

Beverly Hills, Calif.-based Project Playlist, a company that provides an embeddable music player used at MySpace and Facebook, is primarily known for being accused last April of copyright violations in a lawsuit filed by the Recording Industry Association of America.

More recently, the company named Owen Van Natta, Facebook's former chief revenue officer, as CEO. Van Natta is also an investor in the company. The company also recently raised an additional round of funding.

So did the stirrings about an acquisition come from simple wishful thinking on the part of Project Playlist or is Van Natta looking to get out of the RIAA lawsuit by buying a music service with licensing agreements in place?