July 9, 2002 12:55 PM PDT

Judge OKs suit against Kazaa parent

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A federal judge said Monday that record labels and film studios could expand an ongoing copyright lawsuit to include Sharman Networks, which distributes the popular Kazaa software.

The Recording Industry Association of America (RIAA) and the Motion Picture Association of America (MPAA) sued three prominent file-swapping companies in October in Los Angeles federal court. The suit named Morpheus parent StreamCast Networks, Grokster and Kazaa BV, the Netherlands-based company that originally created the Kazaa software.

But in February, Kazaa BV sold the Kazaa file-swapping software to Sharman, a company later revealed to be based for tax reasons in Vanuatu, a small island in the South Pacific. The recording and movie industry trade groups asked permission to add that company to the lawsuit in June.

In court Monday, Judge Stephen Wilson said he would allow Sharman to be added to the lawsuit. A written version of the ruling, required before the MPAA or RIAA can take any action, was not immediately available.

Sharman said the company had not yet seen a written order but that it was confident its technology would survive any court challenge.

"Sharman's fundamental belief is that the distribution of the Kazaa Media Desktop is not only legal but also one of the most important drivers of the future of peer-to-peer technology," the company said in a statement. "We are confident that our legal position will be vindicated by the court."

The case against StreamCast, Grokster and now Sharman is viewed by many in the legal community as the best chance to establish a legal defense for peer-to-peer technology. Unlike Napster, those companies do not maintain central servers that help link file swappers. The companies themselves simply distribute the software used by file traders and contend that this should shield them from legal liability.

A long case could drain the small companies' resources, however. Already the Netherlands-based Kazaa BV has indicated it does not have the resources to continue the legal fight, and StreamCast's original attorney withdrew from the case after the company indicated it couldn't afford to pay him.

 

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