Litigation Over Rio Portable MP3 Player Ends

Recording industry executives on Wednesday announced an end to all litigation over the Rio portable MP3 Internet music player, which a federal appeals court has ruled does not violate anti-piracy laws.

In a joint statement, the Recording Industry Assn. of America (RIAA), the Alliance of Artists and Recording Companies (AARC) and Diamond Multimedia Systems Inc., the maker of the Rio, said they had reached “mutually satisfactory resolution of outstanding legal issues.”

“Rio has set in motion a new age in digital music enjoyment,” Ron Moore, general counsel of Diamond Multimedia, said in a statement. “We felt it was important to bring this exciting new technology to market for all of those who create, distribute or enjoy music.”

The announcement marked a formal end to months of litigation over the Rio, one of a new breed of portable, pager-sized Internet music players that can download and play CD-quality songs encoded in the so-called MP3 format.

Sensing a potential new threat for music piracy, recording industry executives asked the courts to issue an injunction barring sales of the device. This was denied, and the companies appealed.

In June, a federal appeals court in San Francisco killed all hope for blocking the Rio when it ruled that the device was not primarily a recorder and thus was not subject to 1992 federal anti-piracy laws.

In the meantime, however, both MP3 player manufacturers and the recording industry have cooperated in developing the “Secure Digital Music Initiative” (SDMI), a joint effort to establish guidelines for Internet music formats and devices by the end of the year.

As part of Wednesday’s announcement, all the major players vowed to continue cooperation in hopes of bringing order to the fast-growing Internet music scene.

“The RIAA is also pleased to bring a formal end to this legal process,” Cary Sherman, senior executive vice president and general counsel of the RIAA, said in a statement.