News Blog

Some people might be embarrassed if their friends found an old copy of Mr. Big's "To be with you" or Paula Abdul's "Cold hearted (snake)" stashed away in their CD collection. But not EMI. They own those songs, and they want the world to know it.

The music giant is suing social-networking site Hi5, video advertising start-up VideoEgg, and 10 unnamed defendants for allegedly infringing on the copyrights of those and hundreds of other pop throwbacks.

The lawsuit alleges that Hi5 users have uploaded and disseminated hundreds of music videos the company owns rights to. VideoEgg is on the hook because it's a former partner of Hi5, and those allegedly infringing videos were uploaded to its servers. (On May 31, VideoEgg stopped hosting videos uploaded by the public and refocused efforts on its ad network, prompting rumors that the company was on its way out.) The lawsuit doesn't say much of anything about who the 10 John Does are.

The companies had attempted to work out some kind of deal for more than a year, a source told TechCrunch, but those efforts eventually failed.

For the first time ever, the federal government has successfully won a jury verdict against someone accused of illegally downloading music, according to a statement from the U.S. Department of Justice.

A jury in Alexandria, Va, found Barry Gitarts, 25, allegedly a member of Internet music piracy group, Apocalypse Production Crew (APC), was found guilty of conspiracy to commit criminal copyright infringement.

Gitarts faces up to five years in prison, a fine of $250,000 and must make full restitution, according to a statement released by the DOJ.

The Recording Industry Assoc. of America (RIAA), which said it helped develop evidence against APC, applauded the jury verdict.

"For the first time ever, a criminal online music piracy case went to trial, and the jury rendered a swift and unanimous verdict," said Brad Buckles, executive vice president for the RIAA. "The crimes committed here -- as well as the harm to the music community -- are severe, and so are the consequences. We congratulate and thank the U.S. Attorney's office for its work on this case."

APC was among the pioneers in music piracy according to the blog TorrentFreak. The group is considered by many to be the first to coordinate pre-release uploading of MP3 files, TorrentFreak reported. Gitarts is accused of participating in the group for nearly a year, the DOJ alleged. The government has convicted 15 APC members so far.

What is different about Gitarts' case is that unlike any of the other APC members, he decided against striking a plea agreement and took his case to court.

What makes APC members different than average Lime Wire users is the group was sophisticated and specialized in releasing copyright music on the Web, according to the DOJ's statement. Gitarts operated a server where APC members stored hundreds of thousands of song files, the DOJ alleged.

A group of academic publishers filed a lawsuit against Georgia State University officials on Tuesday, alleging a systematic abuse of copyrighted works in the online distribution of coursework reading materials.

Cambridge University Press, Oxford University Press, and Sage Publications allege the university "facilitated, enabled, encouraged, and induced" professors to upload the copyrighted materials to its online system for students to download, without first obtaining the necessary permissions or paying licensing fees.

The lawsuit, filed in a U.S. District Court in Georgia, may mark the first time publishers have challenged universities over the electronic distribution of written copyrighted works, noted the plaintiffs' attorney.

"Our clients believe this is a widespread problem," said Bruce Rich, an attorney with Weil, Gotshal & Manges, who is representing the plaintiffs.

The problem first cropped up a couple years ago, noted Patricia Schroeder, head of the Association of American Publishers, of which the plaintiffs are members.

"A couple years ago, we noted a drop-off in universities seeking copyright permission as they shifted to the digital world," Schroeder said. "Even though technology changes, the law doesn't."

The publishers allege Georgia State University permitted its professors to reproduce vast amounts of copyrighted materials and combine them into course packets for students.

Although the problem of copyright infringement is believed to be widespread among colleges and universities, the majority of those institutions contacted by publishers generally cooperate and take steps to remedy the situation, Rich said.

The key issue for the publishers is harm to the market, Rich said. For example, he questioned whether professors would be able to continuing publishing their research, given the related costs involved, if their respective publishers were not compensated for providing the materials.

Although the reproduction of copyrighted materials is permitted under fair use laws, it's limited in the extent the materials that can be copied, such as excerpts verses chapters upon chapters, Rich noted.

A spokeswoman for Georgia State University declined to comment, noting the institution and the parties cited in the lawsuit have not yet been served with the complaint.

WASHINGTON--It's no secret that Recording Industry Association of America President Cary Sherman despises piracy, and he's a vocal fan of proposed laws that would beef up penalties for copyright infringers.

But here's one area where he says the government need not intervene at this point: forcing Internet service providers to be more proactive in curbing pirated content on their networks.

"I don't think anyone here is trying to relegislate this issue," Sherman, said at an Internet policy conference here on Wednesday. "We're much more interested in finding a marketplace way of going about this."

By "relegislate," Sherman was referring to the 1998 Digital Millennium Copyright Act, which contains a section that generally lets service providers off the hook for copyright infringement on their networks, provided that they take down offending material when it's called to their attention.

Sherman revealed those leanings in response to a question from an audience member, who wanted to know how the record industry chief felt about recent statements by U2 manager Paul McGuinness.

McGuinness suggested that Internet service providers need to be taking more proactive steps to keep copyright-infringing content from being swapped on their networks and that the days of legal "safe harbours" restricting such responsibilities, such as the one provided by the DMCA, are over.

"Paul is European, and in Europe there has been much more of a regulatory approach to these issues," Sherman said of the longtime rock band manager.

Sherman did, however, say he was encouraged to see that some companies, such as AT&T, are already experimenting with network filters. But those are business decisions best made outside the framework of regulation, he said. (Verizon, for its part, said Wednesday that it opposes installing such technology.)

Gigi Sohn, president of the consumer advocacy group Public Knowledge, attacked Sherman's praise for automatic filtering systems. She argued they're prone to blocking legal content, stunting fair use of copyrighted material, and being foiled by determined pirates who decide to encrypt their wares.

Sherman said he and the music industry as a whole strongly support fair use but warned, "Let's not let that be the excuse that stops the development of technology that can be beneficial in the long run."

Internet-based copyright infringement is pretty much the only way people can keep track of TV and movies from abroad in Beijing. It's hard to even find legal DVDs, and if there aren't even illegal DVDs to buy, it's often trivially easy to find entire movies on Youku or Tudou.

Yesterday, a Chinese public-security ministry official asked for international help in copyright enforcement, noting that many infringers use Web sites hosted outside Chinese jurisdiction.

"Copyright infringements, by their very nature, are international crimes. To effectively curb such activities, (we) need enhanced international cooperation on law enforcement," said Gao Feng, the official.

I don't doubt that international borders are a challenge for Chinese enforcers, but they certainly could do more here. The illegal streaming versions of movies and TV series from Chinese video sites are even fueling viewers in the United States, where DVDs are no minor investment. The only sacrifices for viewers are the need to wait for buffering and some loss in resolution.

Until legal DVDs or iTunes-like download or rental services are available to the Chinese market, however, I can't imagine that people will stop watching the free or cheap pirated versions.

Yahoo China lost another round in a legal battle as a court in Beijing upheld a ruling that the company is infringing on copyright laws by allowing pirated music to be downloaded, according to the industry group suing Yahoo China.

"The ruling against Yahoo China is extremely significant in clarifying copyright rules for Internet music services in China," John Kennedy, chairman and CEO of the International Federation of Phonographic Industries, or IFPI, said in a statement Thursday. "By confirming that Yahoo China's service violates copyright under new Chinese laws, the Beijing court has effectively set the standard for Internet companies throughout the country."

Yahoo owns a 44 percent stake in Yahoo China, and the controlling stake is owned by Chinese Internet company Alibaba.com, which essentially runs the site. Representatives from Alibaba could not be reached Friday for comment on this story.

The International Federation of Phonographic Industries, which represents the music industry, filed the lawsuit in January 2007 on behalf of several recording studios, including Warner Music Group, Sony BMG, and Universal Vivendi.

In the suit, IFPI accused China Yahoo of violating copyrights because it allows links between its search engine and Web sites that have illegally copied songs from artists such as U2 and Destiny's Child.

In April, a lower court in Beijing had ruled that Yahoo China facilitated infringement of copyrights. Yahoo China appealed the decision, arguing that it should not be liable for content found outside its Web site. Now that appeal has been rejected by a higher court in Beijing, according to the IFPI.

Separately, the court also upheld a ruling on a similar case against Internet company Baidu. A lower court in November 2006 had found that Baidu had facilitated copyright infringement. But because this case was filed under older Chinese copyright laws in 2005, the company was not liable for copyright infringement, the IFPI said.

"We are disappointed that the court did not find Baidu liable," Kennedy said in a statement. "But that judgment was about Baidu's actions in the past, under an old law that is no longer in force. Baidu should now prepare to have its actions judged under the new law. We are confident a court would hold Baidu liable as it has Yahoo China."

China is viewed as one of the biggest sources of pirated music and movies, as well as counterfeit goods. And the IFPI, along with other companies and trade organizations, has been taking legal action to stem the flow of this content out of China. Recent reforms in Chinese law have helped, but experts say piracy still runs rampant.

The IFPI said search services from sites such as Yahoo China and Baidu, which connect users to hundreds of thousands of pirated music tracks, are "a huge drain on efforts to develop a legitimate music market in China." The group claims that more than 99 percent of all music downloading in China violates copyright. Despite the large population and potential of the Chinese market, the IFPI said that in 2006, music sales in China only amounted to $76 million, or less than 1 percent of the entire global recorded-music market.

Still, music labels see huge potential in China, and they have been willing to work with Chinese companies to ensure that music can be distributed legally and without violating copyrights.

In April, Sony BMG Music Entertainment struck a deal with content aggregator Global Music International to distribute its music videos, full-track songs and ringtones to mobile subscribers in China. The deal calls for Global Music to distribute Sony content through wireless-phone operator China Unicom.

Updated at 12:03 p.m. PDT: Just in time to welcome many students back from fall break, the Recording Industry Association of America on Thursday dispatched a new round of "prelitigation" letters to 19 U.S. universities from coast to coast, alleging that campus networks are being used to commit copyright infringement.

For those keeping score at home, this marks the ninth time the RIAA has launched such an initiative.

As usual, each of the 411 letters reveals that a student or employee of the school is about to be sued for copyright infringement. The letters also offer the opportunity for those targeted to settle out of court at a "discounted rate," touting a special Web site that allows targets to settle their claims online.

Here's the list of schools affected this time around and the number of letters for each, according to the RIAA: Drexel University (17 letters), Indiana University (23), Northern Illinois University (25), Occidental College (19), State University of New York at Morrisville (18), Texas Christian University (20), Tufts University (15), University of Alabama (14), University of California at Berkeley (19), University of Delaware (18), University of Georgia (13), University of Iowa (18), University of Michigan at Ann Arbor (20), University of Nebraska at Lincoln (13), University of New Hampshire (30), University of New Mexico (17), University of South Florida (43), University of Southern California (37) and Vanderbilt University (32).

And here's a sample letter sent to an alleged illegal filesharer (PDF), courtesy of Educause, a nonprofit group that represents higher-education institutions and oversees the .edu domain.

The latest load of letters shows that the RIAA isn't letting up on its aggressive attempts to go after allegedly illicit file swapping on university campuses. To mark the start of the new school year, it also sent more than 400 letters to 22 universities last month. Over a four-month span earlier this year, the record industry targeted 1,600 individual students, according to the Electronic Frontier Foundation, a well-known critic of the RIAA's legal tactics.

The RIAA, for its part, attempted to bolster its approach by citing figures from market research firm NPD Group that college students alone accounted for more than $1.3 billion illegal music downloads last year.

"This theft triggers a harmful domino effect throughout the music community--thousands of regular, working-class musicians and others out of work, record stores shuttered, new bands never signed," said Steven Marks, the RIAA's general counsel. "When faced with this reality, we have no choice but to hold those individuals responsible for ignoring the law and all the great new legal ways to get affordable, high-quality music."

Earlier this week, we reported that the RIAA was moving forward with a copyright case against 19 students at George Washington University. But as my colleague Declan McCullagh has pointed out, the RIAA's efforts to track down alleged culprits may be complicated by the length of time that individual universities keep records of their users' Internet Protocol address assignments.

Members of Congress have also gotten into the game again this year, threatening to enact new laws or to withhold funding from universities if administrators don't do more to police piracy on their networks.

The recording industry's victory Thursday in a trial involving a Minnesota woman accused of illegal file-sharing is already turning at least a few heads on Capitol Hill.

Rick Boucher

We caught up by phone on Friday afternoon with Rep. Rick Boucher, a Virginia Democrat well known for his strongly held views on fair use and the need to defang stringent anti-copying laws like the Digital Millennium Copyright Act. (He's one of the Recording Industry Association of America's most ardent foes on copyright legislation.)

We wanted to know Boucher's answer to the obvious question: Will Congress lessen penalties for copyright infringement after Thursday's whopping verdict? We also contacted a dozen congressional offices--from both parties and chambers--whose members frequently work on intellectual property issues. Some never responded, and others said their bosses were traveling or otherwise unavailable for comment.

Here are a few excerpts from my conversation with him a few minutes ago:

On pirating copyright files and the Minnesota case: I have no sympathy for people who engage in illegal peer-to-peer file sharing. These damages are obviously excessive and are way out of line as compared to the kinds of settlements that have been entered into in similar kinds of cases in the us and in other countries.

Even though they have now a very large damage award entered against a person who the jury found was engaged in file sharing, that's not really going to diminish the amount of file sharing that occurs. As a matter of fact, I'm not sure that there's anything the industry could do at this point that is going to eliminate it.

On whether he thinks Congress should do something to rein in damage awards: No, I really don't. I think that's trying to pick around the edges of a problem that frankly doesn't need the Congress' attention.

On what Congress could do instead: What I think we ought to do is reform the Section 115 license [under U.S. copyright law]. That would help a lot in making available more music for lawful downloads.

There are significant problems today for a Webcaster or for an entity that is selling music online to clear the copyright interests of all of the copyright holders associated with a particular musical work, and among those difficulties to clear are those under the Section 115 license, and those happen to be the music publisher and songwriter interests. We have been talking with the music publishers and representatives of songwriters about a way that we can more effectively clear those interests by having, for example, an escrow arrangement at the copyright office for those musical works with regard to whom the songwriter and publisher interest is unknown, where you don't know who wrote the song or who holds the publishing right.

For a lot of the material, that happens to be the situation, and that material today just does not get used and cannot be put up for lawful download because the risk for copyright infringement and lawful damages is too great to do that.

The labels actually tried to be cute several years ago when we were on the verge of passing a compromise on this subject...by attaching some of their pet issues to that legislation. They essentially brought it down because they didn't have the votes to win on their issues but they did have votes to block the bill going forward. It would've been fundamentally in the interest of labels, (and would have) meant more of their music would be available for lawful sale across the Internet.

That would be a step in the right direction, but it doesn't take us far enough. I ultimately think the industry is going to need to come to a realization that it needs a blanket license.

On what the recording industry should do instead of suing people: I really think the time has come for the recording industry to consider some form of blanket license arrangement that would apply fairly broadly across our society.

There are early examples that are very successful for voluntary blanket license arrangements, and what I had in mind are the contracts that the record labels have entered into with a number of universities in this country. Through those contracts, universities pay a lump sum on an annual basis to the record label, and in return for that lump sum payment, the students at that university are able to download and file share among themselves as much music as they want.

Given that success and that some amount of illegal file sharing is destined to continue, i think the time has come for the industry to explore some broader applications of that blanket license arrangement. I'm not going to suggest how that can be expanded.

Contracts could be entered into with the major ISPs. A blanket arrangement could be entered into with Verizon for example with its DSL and FIOS services, or with AT&T for its broadband services. It could be entered into with even smaller ISPs, whereby for a blanket sum, a lump sum payment, the users of those Internet services would be able to download music from those labels, or from other sites that offer the music.

I'm not saying we're going to introduce a bill and force feed this to the industry. The industry needs to consider whether or not it's in its interest, I frankly think it might be. If the industry comes to Congress with suggestions for ways to help implement it, we'll do that.

UPDATE at 8:46 p.m. PDT: A Minnesota woman must pay $220,000 to six of the top music labels after a federal jury found on Thursday that she violated their copyright.

Accused of encouraging the illegal sharing of more than 1,700 songs, Jammie Thomas, 30, elected to fight it out with the recording industry instead of settling out of court for far less money. The ensuing legal battle marked the first time the recording industry has argued a file-sharing case before a jury.

Since 2003, many of the 26,000 persons sued by the Recording Industry Assoc. of America (RIAA) have avoided litigation by agreeing to pay a few thousand dollars. Thomas, who could not be reached for comment, has always maintained her innocence. Accused of sharing music through the use of peer-to-peer service, Kazaa, she told the jury that she didn't even own a Kazaa account.

The jury didn't buy her argument. Thomas was ordered to pay $9,250 for each of the 24 songs that the RIAA concentrated on. She was initially accused of sharing 1,702 songs. The decision is important in that it sends a message to file sharers that Internet anonymity won't protect them from lawsuits, said Chris Castle, a copyright attorney and longtime music industry executive.

Castle said the Web makes it simple to hide. Proving who was sitting at a computer at any given time is very difficult for copyright owners. What is precedent-setting about this case is that the jury decided it doesn't matter who was sharing music on Thomas' computer.

... Read more