The entertainment industry’s legal assault on Kazaa, the Dutch firm that runs one of the most popular online file-sharing networks, may have worked a little too well.
In court papers filed last week, Kazaa says mounting legal costs from fighting the industry’s “Rambo-style litigation” threaten to run the netco out of business entirely, and even asks the major labels and film studios for their “terms of surrender.”
But the entertainment biz is balking at Kazaa’s lament, arguing the scrappy netco is simply playing dead to win sympathy and avoid having to defend itself against claims of copyright infringement.
If the court now finds Kazaa in default, netco almost certainly would have to declare bankruptcy in the face of staggering damages — giving the labels and studios little chance to recover any money.
But that won’t stop the file-swapping party: Kazaa sold its access software and Web site to another company, Sharman Networks, which says it has been told the network will stay up no matter what happens in court.