Court to decide Kazaa's U.S. liability

Thanks xStainDx for posting this in our BPN section. A Los Angeles federal judge will hear arguments Monday as to whether record companies and movie studios can sue the parent company of Kazaa, the most popular online file-swapping service, in the United States.

Much of Kazaa's future, from a business and legal perspective, hangs on the judge's decision. The parent company, Sharman Networks, is headquartered in Australia and incorporated in the Pacific Island nation of Vanuatu, and has tried to keep business contact with the United States to a minimum in order to decrease its legal risk.

If a judge says Sharman can be sued in the United States, Kazaa will get sucked into the same legal maelstrom that has grabbed Napster, Aimster, Audio Galaxy, Grokster and Morpheus, closing some of the popular services and threatening the existence of the others. The Kazaa case is the biggest yet in the recent copyright wars that have been testing the international reach of U.S. courts.

"There are obviously a lot of companies that hope being offshore will give them some immunity from the incredible litigation machine," said Fred von Lohmann, senior intellectual-property attorney for the Electronic Frontier Foundation, which is representing Sharman rival Streamcast Networks in an associated case. The judge's decision, von Lohmann said, "will send an important message."

News source: CNet News - Court to decide Kazaa's U.S. liability