Court Rules Against LimeWire in Copyright Lawsuit

The four big record labels won a major copyright infringement suit against file sharing vendor LimeWire today, with a New York-based court finding that it committed copyright infringement and induced its users to do so as well. (complete ruling as PDF, via Wired News) The court granted a summary judgment against LimeWire, and judge Kimba M. Wood scheduled a conference on June 1 to discuss further steps, which could include an injunction against that would prevent it from continuing to distribute its client, as well as potential monetary damages.

The case of the major music labels relied heavily on expert findings that the vast majority of files traded via LimeWire infringe, as well as inside information that the court now deemed proof of LimeWire’s knowledge of the ongoing infringement. Part of the evidence used were Google (s GOOG) Adsense ads bought by LimeWire to advertise its software with keywords like “mp3 free download” and “napster morpheus.” From the court decision:

“(LimeWire’s) Google advertisements promoted LimeWire with direct references to other infringement-fostering programs. For example, LW purchased banner advertisements for LimeWire that read ‘Join Millions of Morpheus users and download the best P2P file-sharing application for free. Free music downloads . . .’; ‘Outperforms Morpheus!’; and ‘Faster Downloads Than Kazaa!'”

Part of the case was also based on testimony by LimeWire’s former COO Greg Bildson, who was personally targeted in the original lawsuit. The music labels settled with Bildson in exchange for information, and LimeWire unsuccessfully attempted to exclude his statement from the case’s evidence.

The court decision got cautions reactions from the tech community. Consumer advocacy group Public Knowledge, which had avoided taking sides in the case while at the same time trying to stand up for innovation, issued the following statement:

“(We) are troubled when this court, or any court, tries to determine whether infringement has taken place based on the technical capabilities of a product or service.  Our goal, as we and others expressed in an amicus brief, is that technological innovation should be protected.”

LimeWire’s CEO George Searle was obviously much more blunt in his own statement:

“LimeWire strongly opposes the Court’s recent decision. LimeWire remains committed to developing innovative products and services for the end-user and to working with the entire music industry, including the major labels, to achieve this mission. We look forward to our June 1 meeting with Judge Wood.”

LimeWire has mostly focused on music sharing, and the company has made some efforts to work with music rights holders in the past through opening an download store and working on an ad-based P2P monetization scheme. However, LimeWire has recently also begun to more openly embrace video, launching a video podcast directory about a year ago.

Picture courtesy of Flickr user Henrik Thorn.

Related content on GigaOm Pro: The Quest to Monetize File Sharing (subscription required)