Tue, Sep 20, 2005 - Page 11 News List

EMI partner wins suit against Baidu

COPYRIGHTS A Chinese court ordered the search engine to pay a distribution partner of EMI just more than US$8,600 for allowing free music downloads

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Baidu.com Inc (百度), China's most-used Internet search engine, was ordered by a Beijing court to compensate a Chinese partner of EMI Group Plc for allowing free downloads of 53 songs through its Web site.

The Beijing Haidian People's Court awarded compensation of about 70,000 yuan (US$8,652) to Shanghai Busheng Music Culture Media Co (上海步升音樂文化傳播), EMI's China distribution partner and licensee, and ordered Baidu to remove links to the service, Chen Feihung, EMI's Southeast Asia vice president of new media, said yesterday. Cynthia He, investor relations manager at Baidu, couldn't be reached immediately for comment.

"This is good news and it sets a clear precedent for the other court cases," Chen said of the Sept. 16 ruling.

EMI, Sony BMG Music Entertainment, Warner Music Group Corp and Universal Music Group have filed lawsuits against Baidu in the Beijing Intermediate Court, seeking to stop the company from offering free music downloads. Those cases are scheduled to start on Sept. 26 after an initial hearing on Friday, Chen said.

Restrictions on Baidu's services would make it more difficult for the Beijing-based company to maintain its lead over Google Inc, the world's biggest search engine company, in the world's biggest Internet market by users. Baidu shares plunged 28 percent on Sept. 14 after analysts from two firms that managed the company's initial share sale said the stock was overpriced, citing competition and the possibility of copyright infringement.

The music industry has filed more than 14,000 lawsuits in the US alone since September 2003 and settled about 3,200 of those, the Recording Industry Association of America's spokesman Jonathan Lamy said on Sept. 1.

Baidu shares dropped 4.5 percent to US$78.35 on Sept. 16. They had more than quadrupled since the company raised US$109 million selling shares last month. The company disclosed in its share sale prospectus that it was being sued by Shanghai Busheng and Beijing New Picture Film Co (北京新畫面影業), copyright owner of the movie House of Flying Daggers, for alleged copyright infringement.

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