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Universal Music Sues MySpace

November 20, 2006

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Universal Music Group has issued an infringement lawsuit against MySpace.

Universal filed the action in the US District Court in Los Angeles late Friday, alleging that MySpace “harbors no illusions” that its destination contains infringing content. The action also asserts that MySpace “knowingly and intentionally operated its business on the fiction that it has obtained the licenses it needs to exist” from users that it “well knows are not the true copyright owners.”

Universal said that Myspace is encouraging members to illegally share music and videos, including those by artists on the company’s roster. It says that material from some of its biggest artists were sometimes available on the site ahead of their general release.

The attorneys go further by saying that MySpace “have made infringement free and easy”, turning MySpace Videos “into a vast virtual warehouse for pirated copies of music videos and songs.”

The lawsuit is seeking damages of $150,000 for each unauthorized music video or song posted on MySpace, alleging that MySpace not only is aware of the infringement but also makes money selling advertising to the millions of users attracted by the lure of free access to copyrighted works.

 

MySpace quickly issued a response. “MySpace provides an extraordinary promotion platform for artists – from major labels to independent acts – while respecting their copyrights,” the statement read.

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The company added that MySpace was protected under the Digital Millennium Copyright Act (DMCA), which provides special legal protections known as “safe harbors” to Web-hosting sites that remove copyrighted works after receiving takedown notices from the content owners.

 

“Moreover, we proactively take steps to filter unauthorized music sound recordings and have implemented audio fingerprinting technology.” In fact, Universal’s lawsuit came just hours after MySpace had launched a new copyright protection tool.

Announced earlier last month, the “fingerprinting technology” from Gracenote will use a file-filtering application to scan old and new content to weed out any unauthorised material.

It is said it will help prevent unauthorized music from landing on the site while making it easier and faster for content holders to remove unauthorized content.

The filtering system is designed to automate the removal of unauthorized works from the site once they have been flagged by copyright holders. Illegal files, the company said, would be removed and persistent offenders would be banned from the site.

But, apparently, this wasn’t enough to satisfy Universal’s litigation spree: in September, Universal chief Doug Morris threatened to sue sharing sites like MySpace and YouTube for cheating the company out of “tens of millions of dollars” by allowing users to post its videos on their sites.

In October, Universal agreed to a pact with YouTube shortly before the site was acquired by Google, then sued Grouper, a site acquired by Sony in August, and privately held Bolt for similar infringements.

This aggressive legal campaign against social networking sites has started right after Universal’s agreement to license its youtube_logo.gifsongs and music videos to YouTube. They say so themselves: “We didn’t try to sue (MySpace) right off the cuff. We’ve been trying to negotiate a deal like the one we have with YouTube. Filing is always a last resort”, making clear that “Our goal is not to inhibit the creation of these communities, but to ensure that our rights and those of our artists are recognised”.

In other words, to get their fair share of a deal of a cultural phenomenon that’s been drawing tens of millions of users and one that some see as a powerful tool for performers to get exposure for their music.

The issue has taken on more importance as services built around user-generated content become popular and generate advertising revenue.

If Universal can win in court, it is likely to gain leverage in negotiating licensing terms with user-driven services — just at the moment that those services are attracting deep-pocketed partners.

Anthony Berman, a San Francisco lawyer specializing in entertainment and Internet issues, said that while the procedures for an Internet company to receive a “safe harbor” under the law were unambiguous, there might be room for legal debate about exactly which sorts of services could seek it.

Mr. Berman said Universal’s case was intended more to press MySpace into a lucrative licensing deal rather than into a real court fight. “It’s a way to get MySpace to the table,” he said. “It’s less about piracy. It’s a lot about control.”

This lawsuit is also seen as part of a strategy by Universal to test provisions of a federal law that provides a “safe harbor” to Internet companies that follow certain procedures to filter out copyrighted works. The law requires sites to remove such content after being notified by the copyright holder.

The issue of copyright on sites such as MySpace is a hot topic. To avoid the threat of legal action, Google is trying to win permission from media companies to broadcast output legally on YouTube, just has they did with Universal.

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It’s no wonder that after their $1.65 billion YouTube acquisition deal, Google has set aside $200 million in stock to cover possible legal fights over copyright.

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