Pirates walk plank

Court backs RIAA; file-swappers offer plan

WASHINGTON — Record labels and Internet music-swapping sites clashed again this week as the two sides struggle to gain the upper hand in their battle over piracy.

The Recording Industry Assn. of America touted two major legal victories Wednesday.

An online vendor of pirated CDs and cassettes based in New York was ordered to serve six months in jail and pay a $3,000 fine for offering more than 100 compilations of rap and blues artists for sale illegally.

In addition, four members of the “warez scene” — a cross-country underground music piracy network –pleaded guilty last week to distributing thousands of copyrighted music files, many of which were sold before labels had a chance to release them on the market.

The trade group Wednesday also slapped the owners of a New Jersey flea market with a lawsuit accusing them of “flagrantly and repeatedly” ignoring numerous demands to curtail the sale of pirated CDs and cassettes.

The action came the same day an alliance of peer-to-peer file swapping sites backed by the parent company of Kazaa hatched a plan to go legit at a gathering in D.C., and a few days after Charter Communications became the first cabler to fight the RIAA’s right to obtain the identities of its customers who have allegedly traded songs online. The cabler filed a “motion to quash” the RIAA’s request for the identities of 150 Charter customers on Friday.

First to fight RIAA

The move makes Charter the first cable company to fight the RIAA in a courtroom over its campaign to target peer-to-peer song swappers with lawsuits.

In an attempt to shake off the RIAA’s legal shackles, Sharman Networks and affiliated company Altnet recently helped form the Distributed Computing Industry Assn. as a forum for like-minded businesses involved in the file-sharing world.

At the meeting, the groups revealed a plan to channel at least some of the tens of millions of dollars the music industry loses each month in downloads back to artists and record labels in hopes of spawning a new revenue stream for the music biz the same way VCR rentals benefited Hollywood.

Specifically, the Internet sites would agree to pay a portion of online music sales revenue they make to the labels, an offer the groups estimate could ultimately produce (in about four years) $900 million a month, if both sides agrees to drop all legal action and move on.

Plan might be non-starter

If Napster is any precedent, however, the proposal is a non-starter as long as the file-swappers continue to condone illegal downloading of any kind.

“It is hard to take seriously proposals to turn P2P systems into legitimate businesses when they continue to induce users to violate the law, and willfully refuse to use available technologies to stop the rampant infringement of copyrighted works on their networks,” an RIAA spokeswoman told Daily Variety in a written statement.

DCIA prexy Marty Lafferty provided a detailed explanation of the trade group’s plan, predicting it could turn the music biz around and give labels more control of every song swapped over the Internet, if they would just embrace the new business model.

“It’s almost as if a war has been declared and there’s no truce,” he remarked. “… We want to foster positive business solutions and do to (the music industry) what VCR rentals did for movies.”

RIAA offensive continues

While the negotiations between the music and file-swapping industries have yet to gain any real traction, the RIAA has continued its aggressive legal tactics to attack the piracy problem.

The RIAA reported that a District of Columbia court sentenced Alan Davis to six months in jail and one year of probation for operating http://www.empirerecords.com, that illegally offered more than 100 pre-release CDs and cassettes. The underground “warez music scene” now also has four fewer members. Travis Myers, of Yakima, Wash., Terry Katz of Yorktown Heights, N.Y., Walter Kapechuk of Schenectady, N.Y., and Warren Willsey of East Berne, N.Y., all pleaded guilty a week ago to online music theft.

The RIAA explained that the lawsuit against the New Jersey flea market, one of the largest on the East Coast, came after repeated attempts to curb the sale of pirated CDs. There were three state and local law enforcement raids, in which 26 vendors were arrested and more than 12,000 illegal CDs and 4,000 illegal cassettes seized.

In March of last year, RIAA reps met with managers of the market to raise concerns and offer training on how to identify and rid their vendors of pirated music.

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