Napster Inc., which is being sued for copyright infringement,
yesterday tried to distance itself from MP3.com following the
decision this week by a US judge to award damages to Universal
Music of between $118 and $250 million for wilful copyright
infringement.
Jonathan Schiller, a lawyer for Napster, the internet
song-swapping service, said: “We believe it is clear from a reading
of Judge Rakoff’s decision that the MP3.com case is both factually
and legally distinct from the Napster case.”
The Recording Industry Association of America (the RIAA),
representing the world’s biggest record labels, is suing Napster
for contributory copyright infringement. The Napster.com web site
acts as a directory of MP3 files which its 20 million registered
users can access from each others’ hard drives, although Napster’s
servers do not actually story any of the files. The next instalment
of the case will begin on 2nd October, following a federal Appeals
Court’s decision to overturn a preliminary injunction against
Napster that would have forced it to close its service.
Shares of MP3.com fell significantly following the court’s
ruling against it on Wednesday. CEO Michael Robertson is quoted by
Reuters as saying: “In the worst case scenario, we’d have to write
a cheque for $115 million… While its painful and nobody wants that,
it’s not going to wipe out the company.” The company had $315
million in cash at the end of June and took a $150 million charge
against its second-quarter earnings for estimated legal costs. In
settling claims by four other record companies, it has already
agreed to pay around $80 million.
