NAPSTER LOSES OUT IN LEGAL BATTLE

Round one to the Recording Industry Association Of America...

Napster faces shutdown after the RECORDING INDUSTRY ASSOCIATION OF AMERICA won the first round of a legal fight to put the brakes on the Internet company’s file-sharing technology.

A California judge ruled yesterday (July 26) in favour of the RIAA at a preliminary hearing, the first of a series of legal battles the under-fire MP3-sharing software provider faces.

Napster chief Hank Barry declared he will fight on, and is to appeal the decision today. But if he is unsuccessful, the site could be out of business by midnight tomorrow.

Speaking on a webcast last night with Napster founder Shawn Fanning to respond to the decision, he said the company will fight to keep their technology afloat in the run up to the actual trial, via an appeal to be filed later today (July 27).

“[Wednesday] in Federal Court the Judge issued an order that basically would have the effect of shutting down the Napster service as it currently exists,” Barry said. “We will be appealing the judge’s ruling to the court of appeals [Thursday] morning to stay the judge’s order during that appeal process. If we do not get a stay then we have until midnight Friday to comply with the judge’s order. Although we strongly and firmly disagree with the judge’s decision we respect and understand the basis for it and we plan to comply.”

He continued: “The judge’s ruling essentially is this – that 1:1 non-commercial file sharing violates the law. We’ll fight this in a variety of ways to keep the Napster community growing and strong and we’ll keep you informed and we’ll ask for your help.”

Barry also said in response to numerous fan inquiries, the staff would be brainstorming throughout the night to come up with ways members of the Napster community, whose numbers total 20 million, could help. Suggestions and updates will be posted on [url=]www.napster.com, he said.

Meanwhile, the RIAA announced their satisfaction with the verdict, stating they believe the ruling will lay the foundation for similar cases.

“We are pleased with the court’s decision,” RIAA Senior Executive Vice-President and General Counsel Cary Sherman said in a statement. “This decision will pave the way for the future of on-line music. This once again establishes that the rules of the road are the same on-line as they are off-line and sends a strong message to others that they cannot build a business based on others’ copyrighted works without permission.”

Wednesday’s Preliminary Hearing ruling is only the first of many. Napster still faces more court time in San Francisco for the actual trial with the RIAA, which represents major US record companies including Universal. They also face individual lawsuits filed by Metallica and Dr. Dre, both of which will take place in Los Angeles Courts. Dates for all three trials have yet to be set.