Kazaa gets deadline to filter or shut down

25 November 2005 7:55 by James "Dela" Delahunty | 17 comments

An Australian court has ordered that Kazaa must implement
filters to block the sharing of copyrighted music by December 5th
or to shut down the service. This deadline comes after
September's ruling by the Australian court that Kazaa users had
broken the law and Sharman Networks needed to find a way to
block future copyright infringement on the network. "It's time for
services like Kazaa to move on -- to filter, go legal or make way for others who are trying to
build a digital music business the correct and legal way," IFPI Chairman John Kennedy said in
a statement.

All of this kicked off when Sharman's offices were raided on 6th February, 2004 by the anti-
piracy subsidiary of the Australian Recording Industry Association (ARIA), called Music
Industry Piracy Investigations (MIPI). Raids were launched after an Australian court granted
MIPI a search warrant, so-called Anton Pillar order, that allows copyright owners to search
premises to find evidence of alleged copyright violations. Sharman condemned the raids, calling
them illegal.

Sharman said the Anton Pillar order that allowed the raids to take place "was not granted based
on all the facts." Sharman's complaint was then heard in March (the MIPI was not allowed to
access seized documents until the decision) but the court sided with the recording industry and
rejected Sharman's claims that the raids were made without valid reasons. One week later on
March 11th, Sharman appealed the ruling.

On July 3rd, 2004, a date was finally set for the Kazaa vs. MIPI trial (November 29th, 2004)
and Judge Murray Wilcox dismissed several claims raised by Sharman Networks regarding
access to the evidence seized by MIPI in the raids. On October 8th, 2004, Wilcox' view was
backed up by an appeals court that once again sided with the recording industry and rejected
Sharman's claims. Then in November, everyone prepared for the case to begin.

The Kazaa trial began with a massive piracy claim by the MIPI who said that Kazaa was the
world's biggest piracy network. "Sharman paints themselves as the defenders of the interests of
fans of music [but] they are trading off the copyright-infringing activities of its users. Far from
inhibiting infringements, they are actually encouraging them." said Tony Bannon, counsel for
the labels. In day 2 of the trial, Tony Meagher, a lawyer for Sharman denied the claims the
Recording Industry.

Tony Bannon decided to hit back at Kazaa's defense of the accusations by telling the court how,
earlier a commitment was made by Sharman Networks to rid Kazaa of Child Pornography. He
then made the argument that if Child Pornography could be properly filtered out, then why cant
pirated MP3 files be filtered out? And why has Sharman made no such promises to the recording
industry? You can argue that the real reason Child Porn was brought up was an attempt by the
MIPI to make Kazaa look a lot worse than it already did in court.

Then witnesses claimed that despite the claims of Sharman Networks, Kazaa can be properly
filtered. In an interesting challenge then, a lawyer for Sharman Networks, Mark Lemming,
accused University of Melbourne professor Leon Sterling of switching sides. He claimed that
Sterling had offered to be an expert witness for Sharman Networks, but later emailed them
withdrawing the offer, saying that writing a report requested by Sharman would be "stretching
his expertise."

The trial continued, getting even more controversial when the Red Cross was caught up in the
mess. The Recording Industry requested that the Red Cross freeze a trust fund allegedly
controlled by the owners of Sharman Networks. "It would be incredibly disappointing if we had
to sue them," said Michael Speck of the MIPI. However, the Red Cross later denied any link
with a trust fund controlled by Sharman Networks.

In probably the killer of Sharman's defense, documents were shown that proved that Sharman
had a lot more control over the Kazaa software than it had claimed. It had ability to even log user
activity and logs of discussions showed that Sharman was aware of possible legal difficulties and
privacy issues surrounding logging. Closing arguments were heard in the trial, in which Sharman
claimed it should not be held responsible for the actions of third parties.

In September 2005, Kazaa was ordered by the court to implement filters to block the sharing of
copyrighted material. It also had to pay 90% of the recording companies' legal costs and damages
which have not yet been determined. According to the courts ruling Kazaa, its owners and
executives had knowingly allowed Kazaa users to illegally swap copyrighted songs. The court
found the defendants guilty of copyright infringement even though the infringements were
carried out by Kazaa users.

Whether you love or hate Kazaa, decisions like these are bad for P2P services everywhere. It is
unfortunate that because of Sharman's business practices, other file sharing cases across the
world will have this precedence. It is now time to sit back and see what happens with Kazaa.