Bertelsmann bolstered by court

Napster suit could violate co.'s constitutional rights

A correction was made to this article on August 3, 2003.

BERLIN — Germany’s highest court has stepped in to block a $17 billion joint lawsuit by a group of U.S. music publishers against media giant Bertelsmann for its support of online music swapper Napster, which they say was tantamount to Internet piracy.

The lawsuit, which was filed in the U.S., could violate Bertelsmann’s constitutional rights in Germany, the Federal Constitutional Court said in a statement released late Friday.

“If lawsuits in (foreign) courts are obviously misused to bend a market player to one’s will by way of media pressure and the risk of a court order, this could violate the German constitution,” the statement said.

The emergency injunction freezes the lawsuit for six months while the court considers Bertelsmann’s appeal of a lower court decision allowing the lawsuit. The court said a final decision on whether the lawsuit was unconstitutional would be made after a full hearing.

EMI and Universal also accuse Bertelsmann of seeking to take over Napster and of contributing to copyright infringement with an $85 million loan to the now defunct online service and have filed separate lawsuits.

Bertelsmann has countered that its cooperation with Napster does not make it liable for Napster’s legal infringements.

Company also filed a motion earlier this month with a U.S. federal court in New York to dismiss the claim, arguing that U.S. copyright law does not permit recovery from a third-party lender for damages the labels failed to recover from Napster. A Bertelsmann spokesman said the group was using all available options to fight the lawsuit.

Bertelsmann hoped to transform Napster into a legal and licensed file-sharing service in which other record labels were invited to participate. The group has called the charges “groundless and cynical,” given that its intentions were supported by many in the industry.

(Reuters and AP contributed to this report.)

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