Music industry under pressure after landmark MP3tunes copyright ruling

EMI, whose artists include Katy Perry and Coldplay, has suffered a significant defeat in its case against music locker service MP3tunes

Music industry under pressure after landmark MP3tunes copyright ruling

Music giant EMI has been dealt a blow in its long-running lawsuit with MP3tunes, after a New York district court said the so-called music locker was not responsible for investigating copyright infringements by users.

The landmark ruling is a victory for MP3, which allows people to build online collections of music, mixing songs they have bought with those that have been offered for free on the internet.

It also vindicates the likes of Google, Apple and Amazon who have been fending off legal threats from music publishers for offering similar cloud-computing services for use as virtual "music lockers".

EMI and 14 other music publishers launched legal action against MP3tunes and its controversial founder Michael Robertson in 2007, claimed that they were breaching the federal Digital Millenium Copyright Act by allowing users to upload songs they hadn't bought.

The music companies have also been pushing for cloud-based locker services to pay music publishers a licence fee, on the basis that the services encourage copyright infringement.

Manhattan district judge William Pauley yesterday found MP3tunes and Mr Robertson guilty of not complying with 'take down' notices issued by EMI - but he crucially ruled that the "burden of the investigation" did not fall on them, effectively granting them status as a so-called 'safe harbour' and dramatically narrowing the terms of the case.

Greg Gulia, a partner at Duane Morris, who acted for MP3tunes, described the ruling as a "huge victory" and vindication of MP3tunes' "fundamental business model".

EMI said in a statement that it was "disappointed" that MP3tunes had been allowed to use the safe harbour defence and vowed to continue fighting against this and other locker services.

"Companies like MP3tunes, which knowingly build a business based on stolen music, should not be entitled to any DMCA safe harbor defense, and we're evaluating our options to seek review of those portions of the decision. We will continue to fight - in this case and in the future - for the rights of our artists and writers, and to ensure that they are always properly compensated every time their music is used in a commercial setting," said the music giant, whose rosta of artists includes Katy Perry and Coldplay.

The US ruling is also likely to have significant ramifications in the UK - not least because of its timing, when the government is trying to work out the detail of a shake up of copyright law.

Gregor Pryor, a digital media lawyer at Reed Smith, said: "The first thing it does is pave the way for companies that run locker services in the US to do so without litigation reprisals from music labels or publishers here. However, the real question is what does it mean in Europe because [our] copyright laws are so significantly different."

The government said last month that it would make a raft of radical changes to copyright law, including allowing people to make private copies of music they had already bought - for example, by copying them to iTunes.

However, its position on cloud music services remained hazy and music publishers have been lobbying government to either limit locker services or force them to compensate music companies for likely breaches of copyright law.

Mr Pryor said the US ruling would be used as a starting point which the UK and Europe would work from.

http://www.telegraph.co.uk/finance/8718017/Music-industry-under-pressure-after-landmark-MP3tunes-copyright-ruling.html