As Trial Begins, Early Results Don’t Look Good For Limewire

The fate of Limewire and its founder Mark Gorton is now in the hands of a panel of New York jurors. The service has already been found to have violated copyright law, because it encouraged its users to illegally download music; the file-sharing service was shuttered in October, and the only question left is how much money it should pay to the record labels who sued it. U.S. District Judge Kimba Wood, who is overseeing the trial, made a wide-ranging ruling on various pre-trial motions today. The results weren’t good for Limewire.

Former Limewire CEO Mark Gorton’s fortune is at risk. The court found that Gorton and his other business entities, such as Lime Group and Lime Wire FLP, are also liable for copyright infringement. Those entities were set up in part with the hope of shielding Gorton from liability. Gorton, who was CEO of Limewire from 2000 to 2006, was intimately involved with the management of the company, the court found. Until 2005, Gorton owned at least 87 percent of the company, according to court records.

Limewire’s experts are sharply limited in what they can say, while experts supporting the record labels will have freer rein. Some of Limewire’s expert testimony won’t be allowed in the case. For example its damages expert, George Strong, was prepared to testify that there wasn’t a strong connection between infringement on Limewire and lower record sales. But the court banned Strong from offering much of his testimony in court, “given Mr. Strong’s lack of expertise in the music industry and technology sphere.” For example, he can’t argue that file sharing may have stimulated additional music purchases, because he didn’t do any analysis in that area, Judge Wood ruled.

But the record companies’ experts look just fine to the judge. So they’ll be able to hear from, for example, Dr. Richard Waterman of the University of Pennsylvania, who ran a study which concluded that 98.8 percent of the files requested by Limewire users were copyright protected.

Will the jury hear what artists themselves think about file-sharing? Probably not. The defense wanted to cite public statements by various artists in support of file-sharing. Judge Wood said that’s very likely not going to be admitted. However, if the plaintiffs decide to trot out recording artists as witnesses to talk about how file-sharing hurt them–then (and only then) will the defense get to bring in pro-file-sharing artists’ testimony.

We’ll provide updates on the trial as information becomes available.