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Mon, Sep 05, 2005 - Page 12 News List

IPR world awaits ruling in Kazaa case in Australia


A long-running court battle between Australia's record industry and file-swapping giant Kazaa reaches a climax today, when a judge is to rule on whether the peer-to-peer network is no different from a photocopier or is a giant "engine of copyright piracy."

Lawyers for major Australian record labels want Federal Court Judge Murray Wilcox to find Kazaa's owners liable for copyright breaches and loss of income.

"We have argued file sharing on Kazaa is a breach of copyright and unfair to all those people who try to make a living by creating and producing music," said Michael Speck, managing director of Australia's Music Industry Piracy Investigations, a division of the Australian Recording Industry Association.

"This is a long-awaited judgment on an issue that's critical to the music industry, artists and consumers worldwide," he said.

Among the 10 defendants are Kazaa's owners, Sharman Networks Ltd, Sharman License Holdings and Sharman's Sydney-based chief executive officer, Nikki Hemming.

Their lawyers argued that the software used by Kazaa is no different from a tape recorder or photocopier -- and that Kazaa could not control copyright infringement by users of the network.

The case is the latest in a long line of courtroom showdowns between so-called peer-to-peer (P2P) networks and copyright holders lsuch as record companies.

In a landmark case earlier this year, the US Supreme Court said Grokster and Streamcast Networks -- developers of leading Internet file-sharing software -- can be sued because they deliberately encouraged customers to download copyrighted files illegally so the companies could build a larger audience and sell more advertising.

If the record industry wins today and Kazaa's owners are declared liable, it could signal the end of Kazaa. Defendants, including Hemming, already have agreed to freeze their assets ahead of the verdict.

If the defendants are ruled liable, Wilcox will hold a fresh round of hearings to determine the level of damages, which could run into the millions of dollars. Whichever side loses today is expected to appeal.

But whatever the outcome, observers say users of P2P services around the world already are leaving Kazaa for services which allow quicker downloads.

Michael Geist, an e-commerce expert at Ottawa University's law faculty, said the file sharing industry has moved on since the Kazaa trial began last November, with the software underpinning Kazaa now holding only 10 percent of the market, although the Kazaa Web site claims that nearly 390 million people have downloaded its software.

``It just isn't as big a player as it once was as BitTorrent and eDonkey are now far more important to file sharers,'' Geist said.

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