Entertainment industry widens net of lawsuits

The Recording Industry Association of America is widening its legal net and has begun to target file-trading networks and possibly even active file traders in its campaign against alleged copyright infringement.

For instance, a federal judge has given the RIAA and the Motion Picture Association of America the go-ahead to include Sharman Networks in their ongoing copyright lawsuit against P2P networks.

Sharman, which distributes the Kazaa software, now joins StreamCast Networks, (distributor of the Morpheus software) Grokster, and the Dutch company Kazaa BV as defendants in the ongoing file-swapping suit. Kazaa BV sold the Kazaa file-trading software to Sharman in February.

Sharman said in a statement that it is confident it will prevail in court. The strategy of the deep-pocketed entertainment companies is clearly to wear down the P2P companies through a long and expensive court battle. Kazaa BV has stated that it doesn't have the cash to continue fighting the suit in court, and StreamCast is also having trouble raising enough money to retain consistent legal counsel.

But since these file-swapping networks do not maintain central servers that track trades or connect file swappers, they have a good opportunity to build a case that could protect them from legal liability. After all, all these companies do is distribute software used by file traders.

The RIAA has already successfully sued Napster and Audiogalaxy and is pursuing another case against Madster, formerly known as Aimster. All the companies have been sued for "contributory infringement," which would require plaintiffs and judges to charge that they were assisting file swappers who themselves were violating copyright laws.

As for suing file traders themselves, recording industry executives are now backpedaling from statements - recently leaked to the Wall Street Journal - that they were considering a plan to sue prolific file traders.

Driving this potential campaign against individual file swappers is an influential study of Gnutella users conducted by researchers at Xerox's Palo Alto Research Center (PARC). The study found that only about 10% of file swappers provided approximately 90% of the content available through networks such as Kazaa. The recording industry is likely hoping that it can reduce the amount of material available on P2P networks by targeting this extra-active 10% of users.

Targeting file traders is not a new idea. The band Metallica threatened to target users in its suit against Napster, but never followed through. The entertainment industry has targeted the ISPs of file traders, sending thousands of letters this year alone alleging copyright infringement by subscribers. This has caused some ISPs to cancel users accounts.

Then there was the RIAA's targeting of colleges and universities that supported file trading. Administrators were informed that their schools could be held liable for copyright infringement damages if file swapping took place over their networks. A University of Oregon student who made thousands of files available for trading was ultimately arrested and convicted of copyright violations. But the publicity in the case did not reflect well on the RIAA, which backed off this effort.

File trading continues on many academic networks. More recently, the entertainment industry is targeting large companies for allowing employees to store MP3s on corporate servers.

RIAA CEO Hillary Rosen has long insisted that the industry had no intention of going after individual file swappers. She understands that the bad publicity associated with these efforts threatens to alienate the very market that the record companies were trying to reach with their paid music download services.

But there has been lots of talk in the news recently about worldwide record sales dropping 5% around the world. This slump in revenue has evidently provoked the industry to start resurrecting plans to sue individual file swappers. It's already abundantly clear that decentralized P2P systems cannot be shut down unless the software is removed from each user's computer.

The entertainment industry is banking that Congress will pass legislation that would allow copyright owners to launch cyberattacks against distributors of file-sharing programs or other companies that profit from file trading. They insist that they will not attack the hard drives of individual users. But the industry is clearly successful in convincing judges to keep adding defendants to their ongoing suits.

It's worth noting that none of the entertainment industry's legal efforts have done anything to slow down the volume of file trading, which the Yankee Group predicts will rise from an estimated 7.9 billion audio files alone swapped in 2001, to more than 11.4 billion audio files by 2004.

Ann Harrison is a technology reporter in San Francisco. She can be reached at ah@well.com.

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