LimeWire Sued by the RIAA

Thomas Mennecke
August 4, 2006
http://www.slyck.com/news.php?story=1258

FrostWire must be looking awfully attractive these days. In a surprise move, the RIAA (Recording Industry Association of America) has sued Lime Group, LLC., LimeWire, LLC, Mark Gorton (CEO), and Greg Bildson (CTO). Lime Group is the umbrella company which the LimeWire development firm belongs to.

Just recently all seemed well on the LimeWire front. With over 4 million simultaneous users, Gnutella had become a mainstream success. LimeWire's contribution to this protocol, as well as BearShare, resurrected an otherwise mediocre community.

Although LimeWire was a recipient of the September 13, 2005, RIAA cease and desist letters, it continued Gnutella development unabated. The letter demanded P2P developers to "...immediately cease-and-desist from enabling and inducing the infringement of RIAA member sound recordings. If you wish to discuss pre-litigation resolution of these claims against you, please contact us immediately."

LimeWire's continued operation was in stark contrast to other P2P developers such as BearShare, eDonkey, and WinMX, who all ceased operations following the order.

LimeWire's more notable contributions since September was a security upgrade, and a proposed overhaul of the protocol to include DHT and BitTorrent support.

These advancements aroused curiosity as it appeared a serious protocol revision, especially one that greatly enhanced the functionality and efficiency of the user experience, would be in conflict with the RIAA's demands. However LimeWire's work on an expected copyright filter mitigated the immediate expectation that LimeWire would become the next RIAA statistic.

As month's passed, a forced filter never came to fruition and advances kept coming. In fact, according to LimeWire's latest blog entries, two significant developments are (were?) in the works. One is web interface which would allow for remote participation, and a portable version for USB transportability. With negotiations stale and the RIAA impatient, the day of reckoning appears to have come.

"Since the Supreme Court's unanimous Grokster decision last year, we have extended our hand to the major illegal file sharing networks and encouraged them to become legitimate players in the online music marketplace. We have been patient as a number of services – WinMX, Bearshare, Grokster, i2hub, Kazaa – have ultimately decided to close down or transform themselves into legal music services," the RIAA said in a statement.

"Despite numerous efforts to engage LimeWire, the site's corporate owners have shown insufficient interest in developing a legal business model that adequately respects copyrights. While other services have come productively to the table, LimeWire has sat back and continued to reap profits on the backs of the music community. That is unfortunate and has left us no choice but to file a lawsuit to protect the rights and livelihoods of artists, songwriters and record label employees, as well as those companies building legitimate businesses based on music."

The lawsuit, filed in New York's southern district, cites Mark Gorton and Greg Bildon as both exerting substantial influence over LimeWire development and profiting handsomely from the commercialized "LimeWire Pro."

"Defendant Mark Gorton is a principal and the Chief Executive Officer of defendant Lime Wire LLC. He is also a member and the Chief Executive Officer of defendant Lime Group LLC. Mr. Gorton is the dominant influence in Lime Group LLC, and, along with Defendant Greg Bildson, in Lime Wire LLC. Mr. Gorton has been personally and substantially involved in and profits greatly from the design, promotion, marketing and distribution of LimeWire."

In building their copyright case, the RIAA lawsuit also documents that LimeWire encourages sharing, and punishes those who "freeload."

"Defendants have taken steps to ensure that LimeWire users "share" a large number of files on LimeWire, thereby maintaining the draw and reputation of LimeWire as a vast, unauthorized repository of commercial sound recordings...Indeed, Defendants further designed LimeWire to punish those users - called "freeloaders" by LimeWire - who do not "share" enough files with other LimeWire users."

The RIAA's lawsuit builds upon the "induce" copyright infringement standard, which was awarded to copyright holders by the Supreme Court in June of 2005 (MGM vrs Grokster.) The lawsuit claims LimeWire "...induced and continue to induce infringement by, for example, aiming to satisfy a known source of demand for copyright infringement, including the market comprising users of other infringing services that were shut down or 16 compelled to block access to Plaintiffs' copyrighted works, such as Napster, Grokster, and Kazaa."

The RIAA also claims LimeWire actively induces copyright infringement by failing to implement filter unauthorized works and by profiting from an infringing business model. LimeWire was also accused of more traditional "Contributory Copyright Infringement", "Vicarious Copyright Infringement", and "Common Law Copyright Infringement." It should be noted that no other P2P developer has been sued for common law copyright infringement.

"Plaintiffs' Pre-1972 Recordings are subject to common-law copyright protection under the law of New York. As the owners of valid common-law copyrights in the Pre-1972 Recordings, Plaintiffs possess the exclusive rights to manufacture, copy, sell, distribute, and otherwise exploit the recordings."

Many believed, as did LimeWire, that their open source nature would preserve their existence - at least for some time to come. LimeWire's open source nature may not save the company from the RIAA's onslaught, but it may save the Gnutella network. LimeWire's newest features and talent comes from the open source world; even if Lime Group vanishes tomorrow, development won't.