LimeWire Pays RIAA $105 Million, Artists Get Nothing

[nsane.forums]

In the midst of their jury trial, the company behind the defunct LimeWire client and the RIAA settled their dispute out of court. Limewire will pay $105 million to compensate the major music labels for damages suffered. A moment of justice for the music industry, but not necessarily for the artists. The recouped money is destined for reinvestment in new anti-piracy efforts and will not be used to compensate any artists.

According to the injunction that shut down LimeWire last year, the company “intentionally encouraged infringement,” its software was used “overwhelmingly for infringement” and the company knew about the “substantial infringement being committed” by LimeWire users. The evidence further showed that LimeWire marketed its application to Napster users and that its business model depended on mass copyright infringements.

Following the injunction LimeWire immediately disabled its file-sharing client, but the trouble for the company was far from over. Record labels and music publishers kept chasing LimeWire demanding compensation for the losses they claim the file-sharing service operator had caused.

The labels calculated that the company behind the popular file-sharing client owed them up to a billion dollars, and they filed a claim to collect it.

Last week, a New York federal jury trial started, but before this came to an end the two parties agreed to settle the case for $105 million. The RIAA brought in 9,715 tracks as evidence, which means that the amount translates to $10,808 per track instead of the maximum $150,000 the jury could have awarded.

The labels are obviously pleased with the outcome of the case. They’ve successfully argued that LimeWire caused both them and their artists significant losses.

“The resolution of this case is another milestone in the continuing evolution of online music to a legitimate marketplace that appropriately rewards creators,” RIAA Chairman Mitch Bainwol said in a comment.

Too bad, however, that the RIAA isn’t sharing any of the ‘damages’ with the artists, to reward them. Despite presenting thousands of artists as victims in the case, none of them are expected to see any of the settlement money in their bank accounts anytime soon.

RIAA spokesman Jonathan Lamy previously told TorrentFreak that the ‘damages’ accrued from piracy-related lawsuits will not go to any of the artists, but towards funding more anti-piracy campaigns. “Any funds recouped are re-invested into our ongoing education and anti-piracy programs,” he said.

Thus far the RIAA has not announced officially how the LimeWire settlement will be spent, but we don’t expect them to steer away from their previous course. This makes today’s decision on compensation a victory for the major labels, but certainly not one for musicians.

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[DKT27]

LimeWire settles: are Google and Amazon next on RIAA's docket?

LimeWire, the defunct file-sharing service, and its owner are agreeing to pay the record labels $105 million to end a 5-year-old copyright-infringement lawsuit.

The settlement, first reported by CNET, came Thursday during the second week of a trial in which a New York jury was sitting to determine how much the Recording Industry Association of America should get paid. LimeWire faced more than $1 billion in damages. The Copyright Act allows damages of up to $150,000 per infringement.

The deal clearly marks the end of a legal era.

The case against the nation's last for-profit file sharing service commenced as the RIAA began its lawsuit campaign against individual fire sharers. Some 20,000-plus suits against individuals were brought in all—a legal campaign that has now been virtually abandoned. With the old-school litigation strategy behind it, the labels now face their next big task as the digital age has mutated to the cloud age: how to deal with Amazon and Google, which have begun offering storage-locker services allowing music fans to play their tunes from the cloud on devices of their choice.

Neither Amazon nor Google have obtained the labels' permission for their services. Apple is expected to unveil a music-cloud offering soon, and it's not been revealed whether it has the labels' blessing.

If music can be played and stored on an iPhone, for example, then the same music can be played legally over the internet on the same phone. Or so the theory goes.

But the 10,000-pound gorilla in the room is the unclear legality of these storage services playing host to pirated music. And that's where the labels might have some legal muscle.

After all, the judge in the LimeWire case, who ordered the service shut down, had ruled last year that LimeWire's users commit a "substantial amount of copyright infringement," and that the Lime Group—the company behind the application—"has not taken meaningful steps to mitigate infringement."

Mitch Bainwol, the RIAA's chief executive, said in a statement about the LimeWire case that "designing and operating services to profit from the theft of the world's greatest music comes with a stiff price."

With the LimeWire precedent in its pocket, the labels might have some leverage when negotiating payment deals with Amazon, Apple and Google.

Before the RIAA filed suit in 2006 against LimeWire, the record labels' trade group urged it to license its material or shut down. LimeWire refused.

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