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Napster sets in motion blocking of some files

But thousands of songs still available for download

NEW YORK — Following Napster‘s surprise announcement Friday that it has a system to screen files out of its network, the company set to work doing just that, starting with songs from its most vocal opponents — Metallica and Dr. Dre.

But thousands of songs by those and other hit artists were still freely available for download Sunday, as Napster users flocked to the service in anticipation of what they fear may be its last few days in existence.

It wasn’t clear over the weekend when or if the offending files will be blocked, or whether Napster’s efforts will keep the company from having to severely gut or even shutter its service.

At a hearing in San Francisco held by U.S. District Court Judge Marilyn Hall Patel to determine the parameters of a revised injunction against Napster, attorney David Boies said the company’s new technology can identify and block up to a million infringing MP3s.

Announcement was a total about-face on an argument that has been at the core of Napster’s defense since the recording industry filed its first suit against the company in December 1999. From the get-go, Napster has said it can’t block individual files and that any mandate for it to do so would be tantamount to a death sentence.

Hilary Rosen, chief exec of the Recording Industry Assn. of America, was nonplused by Napster’s efforts, saying Friday’s announcement discredits somewhat the company’s past arguments about its technological constraints.

“Well, it was nice that Napster finally acknowledged in court what we’ve been saying for a year and a half — that they could filter out unauthorized material if they really wanted to,” she told Daily Variety.

Too little, too late?

Despite its 11th-hour revelation, however, Napster still faces stiff consequences: At the hearing, attorneys for the RIAA suggested Napster be compelled to block from the service all songs that appear on Billboard’s “Hot 100” singles and top 200 album charts.

If such a demand were met, Napster users would be denied access to hit tracks from such artists as Eminem, Britney Spears, Shaggy, Creed and Jennifer Lopez. It’s far from clear how many of the company’s reported 60 million-70 million users would stick around to poke through what was left.

Songs available

But a check of the service performed over the weekend turned up songs from all those artists, including the single “It Wasn’t Me” from Shaggy’s “Hotshot” — the No. 1 album on the Billboard chart. And those files were still in full demand: On Sunday, there were more than 11,600 users crammed onto just one of Napster’s 100-plus servers.

Napster representatives were not available for comment.

“I really don’t think that there’s all that much they can do at this point,” said Mitchell Kamarck, a new-media attorney at Rosenfeld, Meyer & Susman. “The time to have done something is long past.”

Patel scheduled the hearing to allow Napster and the record industry to weigh in after a three-judge panel from the Ninth Circuit Court of Appeals last month upheld the district judge’s original injunction but asked her to consider narrowing its scope.

Deciding who’s responsible

Napster’s Boies originally interpreted the Appeals Court ruling to mean the new injunction should not force the file-sharer to change its fundamental architecture.

But now that Napster has said it will alter its structure voluntarily, Patel’s deliberations likely will center around whether the company or the labels bear the burden of identifying the infringed files.

Napster isn’t completely out of options just yet. Given a dismal legal outcome, the company could seek a sympathetic ear in the U.S. Congress.

Several legislators, most notably Senate Judiciary Committee chair Orrin Hatch (R-Utah), have made noises indicating their dissatisfaction with what they see as the labels’ heavy-handed legal strategy.

Licensing considered

Among the legislative remedies that have been bandied about is the concept of a compulsory license for digital music downloads, which would require the labels to license their songs for a set fee to anyone who asked.

But the RIAA’s Rosen said a move as drastic as fundamentally altering the copyright law to accommodate such a nascent distribution technology would be premature.

“I really think Congress understands that these are difficult businesses to develop,” she said. “I think they’re going to give the marketplace the time it needs to work these things out on its own.”

Drew Lipsher, former senior VP for business development at BMG Entertainment, also doubted that proposal would fly, since compulsories most often are established for promotional uses, like radio airplay.

Pol pressure?

Instead, he said legislators could be useful in putting pressure on the industry to come to a negotiated settlement.

“You have to propose a fair use to Napster, and then the two sides can arbitrate it,” he said. “But to date, the record companies have not put anything on the table for Napster. Hatch should say, ‘OK, Hilary, on behalf of the industry, why don’t you put a proposal on the table?’ ”

Meanwhile, Napster’s legal strategy will continue on several fronts.

Boies has filed a petition with the Ninth Circuit for a hearing on the injunction before the whole court, rather than just three judges. If that fails, the defendants could take the injunction fight all the way to the Supreme Court.

At the same time, the actual trial against Napster is set to be heard by a jury in Patel’s district court this spring. That case also could wind its way up to the highest court in the land — unless outside circumstances, such as legislation, a protracted shutdown or even a settlement deal — intervene.

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