LimeWire states in the complaint that they did this by “unlawfully” extending their exclusive rights in the sound recordings they produced, in order to “cartelize” the network for the online distribution of music.
This particular piece of the claim will probably fail, although it is a clever argument. The problem is that the Industry is more than welcome to decide to whom they license their intellectual property for distribution. If they wanted to refuse to license their music online at all, they would technically be within their rights as copyright holders. However, LimeWire makes what I think is a better case in their next point, arguing that the industry has engaged in price fixing measures by developing “MusicNet” and “Pressplay” as the sole means for online distribution of all four major labels, preventing price competition between these companies.
The counterclaim also mentions various class actions, and investigations by the New York Attorney General and others, CD price fixing (already admitted), and handing out payola money to radio stations for airplay (also admitted).
The major problem with LimeWire’s counterclaim, frankly, is I don’t see how they’re a proper Plaintiff. In order to sue somebody in our country, you need to be someone who has actually been damaged in some way by the wrongful conduct. In other words, just because you see something really wrong going down, it doesn’t mean you can take it to court, unless you personally are affected.
LimeWire tries to establish they attempted to compete with the major labels in online distribution. They mention a plan they had in place for distributing copyrighted digital rights managed files, through their “Magnetmix” initiative. They state that this would have allowed for copyright owners to be compensated and there would have been a “hash based filter” discouraging users from illegally downloading copyrighted content. They then accuse the major labels of “declining to participate” for anticompetitive and wrongful purposes.
I’m rooting for LimeWire. Just as I don’t think the industry had any right going after iPods or VCRs, I don’t believe the makers of an open ended technology that allows for decentralized file sharing, should be shut down because some of its users choose to use the technology for infringing purposes. But, unfortunately, the problem is far more subtle. It is not the technology itself under attack, but the commercial gains made as a direct result of users’ infringing use.
Article comments
1 - clan garriock
actually various groups such as the sierra club, earthfirst, aclu, greenpeace, etc prevail in lawsuits all the time where they cannot show actual harm was caused them or may be caused. Yet even when they can not prove prevailing interest, courts still grant them standing.