[LINK] 13 record companies sue Lime Wire

[stephen at melbpc.org.au]

Big record labels seeks to freeze LimeWire assets

by Jonathan Stempel Tue Jun 8, 2010 3:49pm
<http://www.reuters.com/article/idUSTRE6572GG20100608?
type=technologyNews&feedType=nl&feedName=ustechnology>


NEW YORK (Reuters) - Thirteen big record companies want to freeze assets 
of the provider of popular file-sharing service LimeWire, accusing its 
founder of fraudulently trying to evade hundreds of millions of dollars 
in damages over copyright infringement.

U.S. District Judge Kimba Wood last month found that Lime Wire LLC 
assisted users in pirating digital recordings, and that founder Mark 
Gorton personally "directed and benefited from many of the activities" 
that resulted in liability.

In papers filed on Monday in Manhattan federal court, lawyers for the 
record companies said Gorton has moved "significant" assets, including 
nearly 90 percent of Lime Wire's ownership stakes, to an entity 
he "openly" hopes will be shielded from damages that could top $1 
billion. The assets allegedly moved were blacked out in the papers.

Gorton and affiliated defendants "have engaged in a series of fraudulent 
actions" to "frustrate a legal judgment in this case," the papers 
said. "An asset freeze is required in order to ensure that plaintiffs 
recover at least some of the monetary compensation they are entitled to."

Last week, the record companies also sought a permanent injunction to 
halt piracies. It said that despite Wood's ruling, Lime Wire appeared to 
have done nothing "to change its illegal ways," and that every recording 
on Billboard's Top 40, Top 40 Country, Top 40 Rock and Top 40 Latin Pop 
charts were still available to download through LimeWire software.

According to court records, Wood on Monday also granted the requests of 
two law firms to stop representing Lime Wire: Fulbright & Jaworski LLP, 
and Porzio, Bromberg & Newman PC.

A Lime Wire spokeswoman said: "We will continue to stay focused on the 
development of our new music service and ensure that the company 
continues business as usual." She added that the change in law firms had 
been planned before the latest court filings, saying: "We were looking 
for a better firm."

Arista, Atlantic, BMG Music, Capital, Elektra, Interscope, LaFace, 
Motown, Priority, Sony BMG, UMG, Virgin and Warner Brothers are the 13 
record companies that sued Lime Wire, backed by the Recording Industry 
Association of America.

Lime Wire created its service in 2000 and has said it has more than 50 
million monthly users. These users accounted for 58 percent of people who 
said they downloaded music from a peer-to-peer service in 2009, a survey 
by NPD Group shows.

Wood's decision followed a 2005 U.S. Supreme Court ruling against file-
sharing service Grokster Ltd, which said companies could be sued for 
copyright infringement if they distributed devices designed to be used 
that way, even if the devices could also be used lawfully.

The law firms that withdrew from the LimeWire case and lawyers for the 
record companies did not immediately return requests for comment.

The case is Arista Records LLC et al v. Lime Group et al, U.S. District 
Court, Southern District of New York, No. 06-05936. (Reporting by 
Jonathan Stempel, editing by Dave Zimmerman)
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Cheers,
Stephen