LimeWire settles court case with RIAA for $105 million

By on May 13, 2011, 10:00 AM

Ending a five-year battle over music piracy, LimeWire founder Mark Gorton and his file-sharing company have agreed to compensate the four largest U.S. record labels for damages in an out-of-court settlement of $105 million.

"We are pleased to have reached a large monetary settlement following the court's finding that both Lime Wire and its founder Mark Gorton are personally liable for copyright infringement," said Mitch Bainwol, chairman of the Recording Industry Association of America. "As the court heard during the last two weeks, Lime Wire wreaked enormous damage on the music community, helping contribute to thousands of lost jobs and fewer opportunities for aspiring artists."

The settlement amount is significantly lower than the $1.4 billion initially proposed by the plaintiffs, at $150,000 per infringing song, but it's still among the largest ever paid by a file-sharing company. Kazaa paid the industry $115 million in 2006 after agreeing to convert into a legitimate service, while Grokster said in 2005 it would pay up to $50 million after a court ruling concluded that the service could be held liable for copyright infringement by its users.

Founded in 2000, LimeWire has been a thorn in the side of U.S. record companies as the last major outfit operating within the U.S. that's been accused of employing music piracy as a business strategy. Where competitors like Grokster, Kazaa, BearShare, WinMX, and eDonkey either went legitimate or closed down, LimeWire kept on going despite legal hurdles and is estimated to have reached nearly 80% illegal file-sharing market share in 2007, according to NPD.

The company was forced to close its service in late 2010 after losing a court battle with music labels, and settled a separate copyright lawsuit by music publishers back in March -- for which terms were not disclosed.

In the months following the LimeWire shut down a NPD report showed that only 9% of U.S. Internet users used peer-to-peer networks to obtain music, down substantially from 2007. Piracy may have slowed down, but as much as music labels would like to tout this as their victory, it's clear that many have just moved to direct download services like RapidShare and MegaUpload. If anything, the success of Spotify, iTunes and a few others shows that innovative music services and fair pricing are much more effective at fighting piracy than lawsuits and scare tactics.




User Comments: 21

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Guest said:

LOL, a limewire article and a picture of an orange being squeezed, c'mon guys you can do better than that.

"And today in the pork industry prices rise" (insert picture of a cow here)

:p

Trillionsin Trillionsin said:

Guest said:

LOL, a limewire article and a picture of an orange being squeezed, c'mon guys you can do better than that.

"And today in the pork industry prices rise" (insert picture of a cow here)

:p

Lol guest had a point.

On the other hand, people still used Limewire? ewww.... what an awful idea.

gwailo247, TechSpot Chancellor, said:

Guest said:

LOL, a limewire article and a picture of an orange being squeezed, c'mon guys you can do better than that.

"And today in the pork industry prices rise" (insert picture of a cow here)

:p

Its one of the crazy facts of life that you never have a lime on hand when you really need one.

How about a lime covered with barbed wire, being squeezed by a profusely bleeding hand, which in turn is being squeezed by a iron gauntlet that has RIAA etched in Gothic script?

Cota Cota said:

aspiring artists

not talented aspiring artists.

There fixed it. *cough Rebecca Black*

stewi0001 stewi0001 said:

Guest said:

LOL, a limewire article and a picture of an orange being squeezed, c'mon guys you can do better than that.

"And today in the pork industry prices rise" (insert picture of a cow here)

:p

I think it's a lemon being squeezed ;-P maybe I'll hope on photoshop when I get home and help out techspot XD

Guest said:

When I buy a product I own it, and should be able to make an historic copy. Can anyone tell me where or how to "contact the recording industry" that I may get replacement vinyl, 8 track tape, cassette tapes and cd's that have been lost, worn out, or suffered any other type of failure? ...I do "own" thousands of songs and albums ...

Guest said:

It's a lemon, not an orange (it's yellow).

Richy2k9 said:

hello ...

the success of Spotify, iTunes and a few others shows that innovative music services and fair pricing are much more effective at fighting piracy than lawsuits and scare tactics.

I agree with this, since we do get music files for cheap & not forced to buy full albums when we need just 1 song, piracy in the music sector has dropped considerably in my surrounding. yet too bad not all services are available worldwide...

cheers!

Guest said:

Cheap & fair pricing?!!... oh-hoho, ...you kids! What unicorn-in-the-sky idea will you kids come up with next? ...getting quality music for the money?? ...Oh it brings tears of laughter to my eyes...excuse me now, i have to hurt some kittens.

captaincranky captaincranky, TechSpot Addict, said:

Cheap & fair pricing?!!... oh-hoho, ...you kids! What unicorn-in-the-sky idea will you kids come up with next? ...getting quality music for the money?? ...Oh it brings tears of laughter to my eyes...excuse me now, i have to hurt some kittens.
Thank goodness TS allows guest posting. Guests just know everything there is to know. Wait, they've coined a termed for that, "know it all".

So, now that you're done trying to talk down to us, why don't you tell us what a your ideas of a "fair price" for an individual track would be?

As to "hurt some kittens", did you know that most serial killers get their first kills with animals? You see, they're already been sadistic a** h***s their entire lives, then they move on to bigger and "better" things.

red1776 red1776, Omnipotent Ruler of the Universe, said:

How exactly did they get to Mark Gorton being "personally liable" for the music trading hands? I don't know much about P2P's , don't use them...but then should he not be in prison for about 10K years for all the underage porn that has no doubt been P2P'ed?

Is this not like holding Ford accountable for all the DUI's that have taken place whilst their vehicles are being driven?

captaincranky captaincranky, TechSpot Addict, said:

How exactly did they get to Mark Gorton being "personally liable" for the music trading hands? I don't know much about P2P's , don't use them...but then should he not be in prison for about 10K years for all the underage porn that has no doubt been P2P'ed?

Is this not like holding Ford accountable for all the DUI's that have taken place whilst their vehicles are being driven?

I'm going to hazard a guess and say that Ford cars have not specifically targeted drunk drivers as their demographic sales base. On the other hand, "LimeWire" was specifically designed for file sharing, most of which is illegal.

Well that, and the fact that Ford Motor Company wasn't named as a co-defendant in this action.

Besides, you can't download "The Expendables" from Ford's website! God knows I've tried.

red1776 red1776, Omnipotent Ruler of the Universe, said:

I'm going to hazard a guess and say that Ford cars have not specifically targeted drunk drivers as their demographic sales base. On the other hand, "LimeWire" was specifically designed for file sharing, most of which is illegal.

Well that, and the fact that Ford Motor Company wasn't named as a co-defendant in this action.

Besides, you can't download "The Expendables" from Ford's website! God knows I've tried.

Wellllll! if you would be serious for a god blessed moment and cease the jocularity! :p

certainly it can (and is) used for copyrighted material, however isn't this a dangerous road to go down as anything and everything can be used for something other than its intended or stated purpose. I doubt, (and I could be wrong here) Limewire started up and said "come download illegal **** here.

I am not a fan of Piracy by any stretch of the imagination, but I am a big fan of the constitution and rule of law.

captaincranky captaincranky, TechSpot Addict, said:

Wellllll! if you would be serious for a god blessed moment and cease the jocularity! :p

certainly it can (and is) used for copyrighted material, however isn't this a dangerous road to go down as anything and everything can be used for something other than its intended or stated purpose. I doubt, (and I could be wrong here) Limewire started up and said "come download illegal **** here.

I am not a fan of Piracy by any stretch of the imagination, but I am a big fan of the constitution and rule of law.

OK, we need to expand the scope of "nolo contendre", to include profound express stupidity. Perhaps we can call it, "the ostrich defense", save for the fact the defendants must have had their heads up their a**es looking for a sand pile.

I'm still amazed these organizations lasted as long as they did, considering the legal outcomes against "Kazaa" pretty much set the precedents.

The legal foundations pertaining to an "entrapment" defense, have all been severely gutted, and in a round about way the basic principles could be applied to these types of cases.

In other words, the police can't "entrap" somebody who was predisposed to a specific type of behaviour, even if they actually did.

In this case "LimeWire" created an environment extremely conducive to the act of illegal file sharing.

If you were to hazard a guess, what percentage of the files on LimeWire do you think, were either copyrighted material, shared by someone other than the actual copyright owner, or copyrighted material given away by the actual owner?

red1776 red1776, Omnipotent Ruler of the Universe, said:

OK, we need to expand the scope of "nolo contendre", to include profound express stupidity.

well....I will accept that I am ignorant of this issue, but not stupid.

If you were to hazard a guess, what percentage of the files on LimeWire do you think, were either copyrighted material, shared by someone other than the actual copyright owner, or copyrighted material given away by the actual owner?

I gather by the manner you ask the question we are talking in the high 90's. I have to claim complete ignorance here. The first I ever heard of Limewire was that it was a virus factory and thusly, I never used it. I had friends who said they used it for legal purposes, ie sharing picture 'albums' as there was a strict low limit on attachments via email services.

I guess mine was a more general philosophical concern over how far this goes. does the tobacco franchise down the road get sued because pot can be smoked in the pipes they sell sort of thing.

captaincranky captaincranky, TechSpot Addict, said:

I guess mine was a more general philosophical concern over how far this goes. does the tobacco franchise down the road get sued because pot can be smoked in the pipes they sell sort of thing.
I don't know what it's like where you live, but here in PA, "head shops" have been banned for decades. So that pretty much exculpates any legitimate tobacco shop from liability if somebody decides to blast a wad of Primo from one of their pipes. And I suppose if a shop owner were selling regular pipes to underage people, that some official agency would find a way to make the owner's life miserable, directly or indirectly.

This is the same argument as, guns don't kill, people do. Lawsuits against S & W usually fail.

However if a gun company were selling pistols out the backdoor, in conflict with prevailing law, then yeah, sue away.

As far as the occasional "legal" file shared in P2P, I suggest that just because John Gotti puts money in a parking meter once in a while, that doesn't mean the authorities should look the other way at the rest of his "activities".

The first I ever heard of Limewire was that it was a virus factory and thusly, I never used it. I had friends who said they used it for legal purposes, ie sharing picture 'albums' as there was a strict low limit on attachments via email services.
Since you can do the same thing legally at "Flickr", I would say your friends are full of s***. (Although to be fair, I don't know if your friend's anecdotes predate Flickr).

And BTW, Flickr pulls stuff right away if they receive a valid DMCA take down request.

red1776 red1776, Omnipotent Ruler of the Universe, said:

Since you can do the same thing legally at "Flickr", I would say your friends are full of s***. (Although to be fair, I don't know if your friend's anecdotes predate Flickr).

No this went way back, not sure but it seems like 1999, 2000? maybe. I don't know anyone that uses it now (the Virus fest thing)

As far as the occasional "legal" file shared in P2P, I suggest that just because John Gotti puts money in a parking meter once in a while, that doesn't mean the authorities should look the other way at the rest of his "activities

Well that makes my point/concern moot then I guess. Like I said , I have always avoided lime wire. KAZAA, Morpheus, etc like the plague. I didn't realize they had been hiding behind a "but we are simply a file sharing...." mentality.

captaincranky captaincranky, TechSpot Addict, said:

Well that makes my point/concern moot then I guess. Like I said , I have always avoided lime wire. KAZAA, Morpheus, etc like the plague. I didn't realize they had been hiding behind a "but we are simply a file sharing...." mentality.
Well, "bit torrent" was developed as a direct response to the collapse of Kazaa. The whole idea was the you're "not sharing a file", you're just contributing some information to the bitstream.

So the reason behind bit torrent is an attempt to skirt the DMCA, pure and simple. If these P2P networks were on the up and up, I doubt that there would be as many a**holes injecting malware into the system.

Concepts like bit torrent have their parallel approach in the illegal drug trade. "Designer drugs" were developed to stay one step ahead of legislation. If one drug is illegal, then you cook something up with a slightly different chemical formula that does mostly the same thing, and wait for legislation to catch up and outlaw it.

The Fed of course got smart, and outlawed the precursors. Hence, P2P is as illegal as whatever amphetamine you decide to cook up with it.

(Ironically, "P2P" is slang for "phenol 2 propanone", as well as "peer to peer" .

And for those of you waiting to ring in and say, "but, there's legal uses for bit torrent", I already know that, and there are many more illegal ones as well.

So, I guess you could summarize a P2P bitstream, as a "precursor" to an illegally shared file.

PanicX PanicX, TechSpot Ambassador, said:

captaincranky said:

Besides, you can't download "The Expendables" from Ford's website! God knows I've tried.

lmao

PanicX PanicX, TechSpot Ambassador, said:

red1776 said: I doubt, (and I could be wrong here) Limewire started up and said "come download illegal **** here.

The pretty much did. Though is was normally worded something like "FREE MUSIC DOWNLOADS".

What I'd actually be curious to know is how many estimated copyright violations took place on Limewire and whats their cost per infringement. I'd guess more than 105 million songs traded places bringing the cost down to less than a buck a song.

Guest said:

Awkward for you *****. Thats a lemon not an orange. You just ruined yourself.

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