After his own company was sued for copyright infringement by several television networks including CBS, FilmOn’s Alki David has now turned the tables. For months the billionaire has been hinting that he might sue CBS for their role in distributing P2P software, and yesterday he filed a complaint with the U.S. District Court of California.

In the lawsuit against CBS Interactive, CNET Networks and LimeWire, David is joined by a collection of rappers and R&B groups including 2 Live Crew, Crucial Conflict and Pretty Ricky. They accuse CNET’s Download.com and the other defendants of several copyright infringement related offenses and are demanding compensation for damages suffered..

“The CBS Defendants have been the main distributor of LimeWire software and have promoted this and other P2P systems in order to directly profit from wide-scale copyright infringement. Internet users have downloaded more then [sic] 220 million copies from Defendants’ website, found at Download.com, since 2008,” the complaint starts.

In addition to LimeWire, the complaint notes that Download.com is still promoting various other P2P-applications which the majority of people use to infringe copyrights. By promoting this software in return for money and by showing users how to download, the CBS defendants are willingly contributing to copyright infringement, the plaintiffs claim.

“The CBS Defendants received massive amounts of revenue from P2P providers on a ‘pay per download’ basis and also from advertising revenues generated by advertisements placed on the download screen for P2P software,” the complaint argues.

“The CBS Defendants’ business model has been so dependent upon P2P and file-sharing that entire pages of Download.com are designed to specifically list and categorize these software offerings.”

“In fact, the CBS Defendants were well aware that these software applications were used overwhelmingly to infringe when they first partnered with LimeWire and other P2P providers, but ignored it in exchange for a steady stream of income.”

The complaint goes on to explain how CNET’s paid editors promoted various P2P-applications, and how they alerted the readers to tools that could circumvent DRM. According to the complaint the entire Download.com system was used to maximize the downloads of various P2P applications, and thus potential copyright infringements.

The above leads the plaintiffs to conclude that CBS and CNET are guilty of inducing copyright infringement, contributory copyright infringement and vicarious copyright infringement. In addition to receiving compensation they want the defendants to stop promoting P2P software.

“Defendants must compensate Plaintiffs for the damages they caused and be ordered to cease future infringement,” Alki David and his crew demand.

Without commenting on the claims in detail, it has to be noted that the Plaintiffs take a huge leap of faith with their allegations. The P2P software (e.g. FrostWire) they want Download.com and others to stop distributing is by no means illegal. LimeWire was found guilty last year not because of the technology it developed, but because it explicitly encouraged infringements.

That said, it seems that the parties in this case are hardly saints when it comes to honoring copyrights. Aside from the FilmOn founder who’s been sued for copyright infringement, several of the artists among the plaintiffs have also been involved in copyright infringement lawsuits, up to the Supreme Court in the case of 2 Live Crew.

In a comment to THR, CBS characterized the lawsuit as a “desperate attempt to distract copyright holders like us from continuing our rightful claims.”

“CBS and a host of other media companies were awarded a court ordered injunction against one of Alki David’s companies last year with respect to that company’s improper use of copyrighted content. His lawsuit against CBS affiliates is riddled with inaccuracies, and we are confident that we will prevail, just as we did in the injunction hearing involving his company,” the company added.

Time will tell who’s right and who’s wrong.

Source: CNET’s Download.com Sued over LimeWire Downloads

There is no arguing that the file-sharing landscape changed for good when the RIAA managed to shut LimeWire down October last year. From one day to another, the most widely known file-sharing application ceased to exist.

At the time we doubted that LimeWire’s demise would have much of an impact on the volume of music piracy, but according to research from the NPD Group we were wrong.

Although there are plenty of alternatives to LimeWire, NPD found that the number of people who downloaded music illicitly using P2P in the last quarter of 2010 has decreased by 43% compared to the year before. The researchers conclude that much of the decline is due to the unavailability of LimeWire, which ceased its operations just a few weeks into quarter 4 of last year.

This data comes from an extensive survey of 5,549 Americans, and translated into the entire population it means that the number of music pirates has decreased from 28 million to 16 million in just a year.

Looking at the market share of the various P2P applications, LimeWire was still in the lead with 32 percent of the music pirates indicating that they’d used it in the few weeks that it was still available. This is down from 56 percent in the year before.

As expected, LimeWire’s shutdown also resulted in a market share up-tick for various other P2P applications. FrostWire appears to be the greatest beneficiary, as it saw a relative increase from 10 percent to 21 percent.

The most popular BitTorrent client uTorrent saw its market share growing from 8 to 12 percent. However, since the total number of music pirates declined so much this actually means that in absolute numbers less people indicated that they used uTorrent to pirate music compared to a year ago.

Taken together NPD’s research suggests that the percentage of music pirates in the U.S. population has fallen drastically, from 16 percent to 9 percent in a year. But the big question is what effect this has had on music industry revenues. Although we don’t necessarily have much faith in the validity of the survey, the RIAA must be delighted with the findings – or are they?

We assume that when they look at their revenues during the last quarter of 2010, the big music labels will fail to see any significant change in their revenues. Why? Well, because music piracy might not have much of an effect on music sales in the first place. But I guess if they can’t use it to their benefit, the RIAA will simply ignore what might be the biggest piracy decline in history.

Source: US Music Piracy Plunges After LimeWire Shutdown

After LimeWire shut down its file-sharing business in October last year, the trouble for the company was far from over. Record labels and music publishers kept chasing LimeWire demanding compensation for the losses they claim the file-sharing service operator had caused.

One of these lawsuits has now been concluded with EMI, Warner Bros., Universal, Sony and several other major music publishers reaching a settlement agreement with LimeWire. No details on the deal have been released, except the court filing which note that both parties “shall each bear its own costs of suit, including attorney’s fees.”

While this settlement brings to an end a lawsuit started in June last year when LimeWire was still operational, by no means does it mark the end of LimeWire’s legal troubles. Due to the complex copyright pyramid the music industry has set up, many of the same companies are still fighting the company in a separate case as copyright owners (vs. publishers).

This case is where the permanent injunction which forced LimeWire to shut down was issued last October. According to the injunction, LimeWire “intentionally encouraged infringement” by LimeWire users, its software was used “overwhelmingly for infringement” and the company knew about the “substantial infringement being committed” by its users.

The evidence further showed that LimeWire marketed its application to Napster users and that its business model depended on mass copyright infringements.

The injunction was the result of a lengthy and ongoing litigation process which dates back to 2006, and soon after it was awarded the record labels filed a claim to recoup damages said to have been caused by LimeWire. The labels calculated that the company behind the popular file-sharing client owes them up to a billion dollars.

The case dragged on and in recent weeks dozens of documents were submitted to the court in a noteworthy side-battle. To get to the bottom of how the music industry sets up licensing deals with other Internet companies, LimeWire subpoenaed internal emails from Apple, Amazon, Yahoo, Google, MySpace and others.

Thus far a quarter million pages of emails have been collected, leading LimeWire to draw some interesting conclusions. Among other things, they found that unauthorized downloads actually boosted the revenue of music labels, and that their income took a dive when LimeWire shut down.

Both parties continue their dispute in the coming weeks and a trial has been scheduled for May, in which the damages claim will be assessed.

While the record labels are hoping to catch a big score against LimeWire, many ex-users of its file-sharing client have moved on to one of the many LimeWire alternatives, or the resurrected pirate edition.

TorrentFreak

The RIAA and the company behind Limewire have been fighting out a legal dispute since 2006, but in recent weeks the case seems to have been moving along faster than ever before.

Last month, a US Court ruled that the Lime Group, the company behind Limewire, was liable for the copyright infringements committed by its users. Two weeks later the Lime Group asked the court to reconsider this judgment. This request was followed by one from the RIAA, asking the court to shut down Limewire via a permanent injunction.

The RIAA argues that Limewire’s operation has to be stopped immediately, to avoid it doing any more harm to the music industry in the future. Interestingly enough, very little argumentation or evidence is given for any real losses suffered by the record labels.

“It is patently obvious that the rampant illegal conduct that Lime Wire intentionally induced, and for which it has been adjudged liable, will continue uninterrupted day after day unless and until the Court issues an injunction to rein in this massive infringing operation,” RIAA’s lawyers wrote to the Court.

“Every day that Lime Wire’s conduct continues unabated guarantees harm to Plaintiffs that money damages cannot and will not compensate,” RIAA’s legal team continues. “The scope of the infringements that Lime Wire induced – and that continue to this day – boggles the mind.

The RIAA is right in saying that Limewire users have committed, and are committing many millions of infringements, but there is very little evidence for the massive damage that this has cost. Thus far, a real assessment of the claimed losses has been lacking in most file-sharing related legal cases.

“It does not require sophisticated mathematics to calculate that the likely damage award in this case will run into the hundreds of millions, if not the billions of dollars,” the RIAA argues. However, one of the few academic papers (pdf) that looked at the relationship between actual downloads and lost sales to the music industry has found that there’s no direct correlation.

With that said, the outcome of this case could potentially change the file-sharing landscape for good. Despite BitTorrent being the leading file-sharing protocol for several years already, Limewire is most likely the most installed P2P application on the market. In 2008 LimeWire was the most installed P2P application with an impressive market-share of 37%, compared to 14% for runner-up uTorrent.

If the RIAA score a victory in court against Limewire, hundreds or millions of people will have to seek an alternative download client, which might mean a significant boost in user numbers for some of the major BitTorrent applications.