The owners of the KaZaA file-sharing network are suing the movie and recording industries, claiming that they don't understand the digital age and are monopolizing entertainment.

The owners of the KaZaA file-sharing network are suing the movie and recording industries, claiming that they don't understand the digital age and are monopolizing entertainment. Sharman Networks Ltd. filed its counterclaim yesterday (Jan. 27) in Los Angeles, in response to a copyright-infringement lawsuit brought by several recording labels and movie studios. That lawsuit accuses Sharman of providing free access to copyright music and films to millions of Internet users in the U.S.

The latest filing came two weeks after U.S. District Judge Stephen V. Wilson dismissed Sharman's claim that it could not be sued in the U.S. because it is based in Australia and incorporated in the South Pacific nation of Vanuatu. Wilson had found Sharman subject to U.S. copyright laws because it has substantial usage by Californians and its actions are alleged to contribute to commercial piracy within the U.S.

Sharman's counterclaim alleges copyright misuse, monopolization, and deceptive acts and practices. "In seeking to simultaneously stop illegal copying and to maintain their dominant position in the distribution of musical and movie content, the industry plaintiffs have obscenely overreached," Sharman said.

It seeks a jury trial, damages, attorney fees, and a permanent injunction against the entertainment industry so that it can't "enforce any of their United States copyrights against any person or entity."

Sharman said the entertainment companies are behind the times and don't realize that consumers need not buy CDs, DVDs, or videotapes to enjoy music or films. Sharman also claimed that movie studios "dominate and, when they act in concert, have monopoly power" for the aftermarket distribution of first-run major motion pictures. Likewise, the company said, recording labels "when they act in concert, have monopoly power in the distribution of recorded music."

Movie studios involved in the lawsuit include Metro-Goldwyn-Mayer Studios Inc., Columbia Pictures Industries Inc., Disney Enterprises Inc., and Paramount Pictures Corp. The recording labels are BMG, EMI, Sony, Universal, and Warner.

The studios and labels did not immediately file an answer. The Recording Industry Association of America (RIAA) said it was preparing a statement. The case is one of the largest in the recent online copyright wars testing the international reach of U.S. courts.


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