EMusic, Grammy Producer Join Legal Assault on Napster

A second wave of copyright infringement lawsuits has begun to land on Napster Inc. as rivals and other entertainment companies piggyback on the federal injunction that is crippling the beleaguered song-swapping firm.

Online music retailer EMusic.com Inc., which pays license fees to independent artists and sells their music online, filed a copyright infringement suit Wednesday in U.S. District Court in San Francisco against Napster. The complaint accuses Napster of lying in November when it insisted it could not remove EMusic’s material from the Napster service.

Late Tuesday, the producer of the Grammys show filed a copyright infringement complaint against the Redwood City, Calif.-based company, aiming to stop fans from sharing copies of live performances.

Legal experts say they expect other suits to follow in the wake of the federal injunction issued Monday against Napster, requiring the company to remove songs from its service within three days of receiving notice from copyright holders.

Napster executives declined Wednesday to comment on the new lawsuits.

The company already is facing considerable legal problems. The Recording Industry Assn. of America filed a copyright infringement suit against Napster in 1999. The RIAA’s suit is what led to the federal injunction issued Monday.

EMusic’s suit hinges on a long-standing brouhaha with Napster. The fight began last fall when EMusic launched a controversial technology that searched through Napster users’ computers and flagged digital-music files that it believed were pirated. Napster then bumped these subscribers off the system, saying at the time it had no way to filter out individual song files.

“Napster told us, the courts and their fans that they believed such filtering was technically impossible,” said Gene Hoffman, EMusic’s chief executive. “This past week, they just proved they were lying.”

In its complaint, EMusic, also based in Redwood City, is seeking an undisclosed amount in damages against Napster.

The National Academy of Recording Arts & Sciences, the producer of the Grammy Awards, also is seeking to block Napster users from swapping recordings of live performances aired at last month’s awards show. The academy said it owns the rights to the works and has applied to copyright them, according to court filings.

“This suit is the first of quite a few [complaints] that we’re going to file against services that allow people to swap” recordings of Grammy performances, said Michael Greene, president of the academy.

The continuing legal assault has made industry watchers question Napster’s financial prospects. The company raised $15 million from venture capital firm Hummer Winblad last year, and sources say Napster pulled in $50 million to $60 million more in loans from Bertelsmann. But so far, the company brings in little revenue.