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Lime Wire: Companies
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The Lime Wire case follows many other similar rulings where record companies have sued peer-to-peer networks. Aimster, Napster and Grokster were all successfully sued by the media industry and the operator of the Kazaa file-sharing system (Sharman Networks) was forced to pay damages and become an authorised online music distributor last month.
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Lime Wire is asking for a jury trial. The record companies named in the suit include Arista Records, Atlantic Recording, BMG Music, Capital Records, Electra Entertainment Group, Interscope Records, Laface Records, Motown Record Company, Priority Records, Sony BMG Entertainment, UMG Recordings, Virgin Records America, and Warner Bros. Records.
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Much more interesting is the lengthy section in which Lime Wire discusses its decision to "go straight." The company developed a plan to educate users that downloading copyrighted material was generally illegal and devised a hash-based filter to prevent the transfer of copyrighted works on the Lime Wire network. The company hoped to make money by "encouraging users to purchase music 'legally' by re-directing them to 'legal' sites such as iTunes." If you don't think that this sounds like a profitable strategy, you're not alone.
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Lime Wire has stubbornly resisted the pressure from the recording industry to stop distributing its software in its current form, which makes it very easy for the users to distribute music and video illegally. In fact, the company filed a countersuit in September 2006 on antitrust grounds, calling the RIAA an illegal cartel that conspires to destroy any distribution channel that the recording industry doesn't control.
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Lime Wire was sued in August by more than a dozen companies, including Warner Bros. Records, Virgin Records America and Sony BMG Music Entertainment. The recording labels allege in court documents that the file-sharing program's makers "designed, promote, distribute, support and maintain the LimeWire software" and other services for the purpose of making and distributing an unlimited number of copies of music files.
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A couple of days ago, the company announced that it would begin to offer approved downloads for sale from directly within the Lime Wire application. Unsurprisingly given their ongoing legal dispute with the RIAA, Lime Wire's distribution partners, IRIS and Nettwerk, represent small independent labels and artists rather than the majors. The files will be MP3s, and unprotected by DRM, meaning users won't ever face the problem that former Google Video downloaders now face.
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