Napster sued by EMusic and Grammys

EMusic, a subscription-based music download company, alleges in a suit filed Wednesday that Napster is guilty of vicarious and contributory copyright infringement -- the same charges the RIAA has levied -- by allowing EMusic's licensed songs to be traded on its network. Going beyond the charges that the RIAA made, though, EMusic also alleges that Napster's reliance on these two types of copyright infringement to build its business constitutes unfair competition. EMusic is asking that Napster be enjoined from trading its licensed music, that EMusic be awarded any profits Napster has made from these songs, the maximum damages allowable under the law and attorney's fees.

In its brief, EMusic says that it is the exclusive licensee for digital downloads for songs that it offers on its site, and Napster allowing those songs to be traded on its network constitutes a violation of that license. EMusic has notified Napster of these infringements, but no action has been taken to stop them, according to its brief.

EMusic argues that Napster can and should stop its users from trading these files. Napster had previously argued that such a step was technologically impossible, but reversed course last week and took action on Monday to block tens of thousands of songs from its directory .

The National Academy of Recording Art and Sciences, the producer's of last month's Grammy Awards, also filed a separate suit due to performances from the program, notably rapper Eminem's duet with Elton John, appearing on Napster. The producers say that they had plans to release an album of performances from the broadcast but that the songs' availability on Napster has caused them to reevaluate their plans.

The suit brought by EMusic is not a surprise, said Ric Dube, an analyst with the digital entertainment research firm Webnoize. The company has paid close attention to the RIAA's suit, he said. However, if Napster is able to reach a settlement with the RIAA, then that can easily translate to other suits, such as Emusic's, he said.

The Grammy suit is very different, Dube said, because it concerns the trading of live songs transferred from television to computer by users. This issue could have "far-reaching implications for fair use," he said.

More legal woes

The flood of lawsuits against Napster points to a "distressing" state of affairs, Dube said.

"These days it's very difficult for a company with a bright idea to get the ear of a major media company. It seems that lawsuits have almost become part of business plans," he said, citing such companies as MP3.com which, rather than asking record company permission to create its My.MP3.com service, simply went ahead and started it, and afterward secured licenses after facing lawsuits from the labels. They never would have had a chance if they had asked permission, he said.

The suit comes at a difficult time for EMusic, who is struggling both financially and in its public image, Dube said. The company wanted to become a major player in the digital music world, but instead has only become a niche player catering to independent record labels.

Both the EMusic and Grammy suits were filed in the Northern District Court of California, the same court which heard the RIAA suit. This is not the first such suit EMusic has filed, taking similar action against MP3.com's My.MP3.com service in December. A company is guilty of contributory copyright infringement when it facilitates the act of infringement, as Napster is charged with doing by providing its service. Vicarious infringement is the result of a company having the power to stop the infringement and failing to, as well as having a financial interest in the infringement.

The RIAA sued Napster in December 1999 for copyright infringement. The company has maneuvered through a series of court dates, remaining to stay open and operate freely. However, an injunction handed down Tuesday by US District Court judge Marilyn Hall Patel forced Napster, in cooperation with the RIAA, to begin filtering songs on its network by next week.

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Sam Costello

PC World

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