Jari Ketola
21 Apr 2004 12:22
Even though the former P2P service Napster has long been burried, and even resurrected in the format of a legal online music store, Bertelsmann AG (BMG) is still haunted by its investment in the company four years ago.
On April 27 BMG will return to court to face a lawsuits brought against the company by music labels and publishers. The lawsuits claim that by funding Napster BMG kept the peer-to-peer network running for an extra eight months which resulted in damages of $17 billion to the industry in lost sales. That's $71 million per day.
According to BMG the investments in Napster were made in hopes of turning the site into a legal, licensed service, and the claims made by the plaintiffs will prove difficult to win.
Many plaintiffs are accusing Bertelsmann of "tertiary infringement", which means that they see that by funding Napster Bertelsmann legitimized the service, and opened the Pandora's box that is still releasing new peer-to-peer services today.
Source: News.com