Judge says Morpheus parent can be sued

Were you aware that U.S. Courts had jurisdiction over the small South Pacific island nation of Vanuatu? Evidently one U.S. judge thinks they do. On Jan. 10, an U.S. District Court judge overseeing the copyright infringement lawsuit lodged by the music and film industries against Streamcast Networks, ordered that Australia-based Sharman Networks could also be included in the legal action.

Sharman offers the Kazaa P2P software, which includes Streamcast’s P2P technology. Sharman had argued that it was outside the court’s jurisdiction because it is incorporated in Vanuatu and has no substantial ties to the U.S.  But U.S. District Judge Stephen V. Wilson came to the conclusion that Sharman could be sued by the entertainment industry because 1. It used an U.S.-based PR firm, 2. It distributed its software on a CNET server based in the U.S., and 3. Its software was used by millions of people in the U.S.

The plaintiffs argued that Kazaa gave 21 million American file-traders access to copyrighted music and films and therefore contributed to commercial piracy in the U.S. This is a broad overreach of U.S. jurisdiction and another attempt by the U.S. entertainment industry to stamp out emerging technology that it simply can’t yet effectively compete against.

StreamCast has reportedly already spent $3 million fighting the lawsuit, which is cutting into its ad revenue and preventing the company from being profitable. The judge could approve a motion by StreamCast to dismiss the suit, grant a motion to have the Morpheus service be shut down, or take the case to trial. Even if the judge orders Morpheus to be shut down, StreamCast has no way to prevent its users from file trading.

Despite the legal turmoil, Streamcast Networks is continuing to move forward with its P2P system. The company is getting ready to upgrade its Morpheus file sharing software that will let users search several clusters of about 15,000 PCs instead of just the one cluster involved in a typical search. This will allow all users to search more effectively across the network and make it easier to locate obscure material.

Streamcast will also soon release a version of its software for PDAs and mobile phones so that remote users can send search instruction to their Morpheus client back at their home PC. Now if we could just disengage that “remote justice” feature that the courts are claiming against Sharman, out in Vanuatu.