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Grooveshark calls for Universal lawsuit to be dismissed

By | Published on Friday 2 March 2012

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Often controversial streaming music service Grooveshark has submitted an eighteen page motion to the New York courts calling for Universal Music’s latest lawsuit against them to be dismissed, according to Billboard. In it, the digital company denies the music major’s allegations, and accuses Universal of providing insufficient evidence to back up its claims, concluding that the music firm’s lawsuit is “among the least informative and substantive pleadings imaginable”.

As previously reported, many in the music industry are critical of Grooveshark which is a bit like Spotify, but which lets users upload music to its catalogues. That means that, while it does have licenses from some music rights owners who supply their tracks direct, content belonging to most other record labels and publishers is also routinely available via the Grooveshark platform, uploaded by punters.

Those labels and publishers, Grooveshark insists, can always ask for their content to be removed and the digital firm will comply. And that ‘takedown system’, of course, is core to the streaming service’s usual defence, because if it’s users who upload infringing content, and if an operator has some sort of system to remove said content on request, then that digital company is not liable for the infringement under US copyright law.

But many rights owners reckon Grooveshark – and others – is abusing the takedown system defence provided by America’s Digital Millennium Copyright Act. Those people claim that Grooveshark runs a deliberately shoddy takedown system, often ignoring takedown requests from anyone unlikely to sue, and allowing users to re-upload removed content almost as soon as it had been taken down. Opponents would also argue that Grooveshark’s entire business relies on its streaming service having major label music, and with only one major label deal in place, that means a shoddy takedown system is necessary to ensure unlicensed content is available, so to assure traffic.

However, the problem for the majors is that the DMCA does not provide any minimum requirements for takedown systems on which Grooveshark could be assessed, and precedents set in the few court cases that have considered this matter have generally set the obligations of the digital operators very low, so that, under US copyright law, arguably a shoddy takedown system, and may be even a deliberately shoddy takedown system, is sufficient.

To that end Universal, which has led the legal assault against Grooveshark since EMI settled an earlier lawsuit and licensed the service in 2009, have been trying to find a way to sue the digital company where the issue of takedown systems would not be key to the case. Initial efforts to exploit a technicality in American copyright law (pre-1972 works are protected by state and not federal copyright law, and the DMCA is federal law) were seemingly abandoned after a judge in the EMI v mp3tunes case was dismissive of that argument.

So Universal’s more recent lawsuit claims that employees of Grooveshark, including senior directors, are also uploading unlicensed content to the company’s catalogues, to ensure all the hits are there. If it’s employees rather than users uploading unlicensed tunes then the DMCA’s takedown system provisions become irrelevant, and that’s a straightforward case of copyright infringement. Universal – whose litigation has since been backed by both Sony and Warner – bases those claims on upload data it acquired from Grooveshark as part of the its first legal squabble, and an anonymous comment left on the Digital Music News website, allegedly written by an employee of the digital firm who claimed that bosses there instruct staff members to upload unlicensed content.

But in its application to have the Universal suit dismissed, Grooveshark says that the major has provided no tangible evidence of its employees uploading unlicensed music, nor has the major named any of the tracks that it believes were loaded into the Grooveshark catalogue in this way. “Such incomplete and indistinct allegations”, Grooveshark’s filing says, “do not satisfy the threshold pleading requirements necessary to state a claim for copyright”.

As for the anonymous comment posted on Digital Music News, a copy of which is included in Universal’s legal claim, Grooveshark’s lawyers reckon that is nothing more than an “anonymous hearsay comment”, and isn’t something that should be presented as evidence in court. On more general matters, Grooveshark says that its service operates “within the bounds” of the DMCA, and that it “scrupulously” complies with DMCA takedown requests.

It remains to be seen if the courts agree with Grooveshark’s viewpoint that Universal’s evidence of direct infringement is so woeful that this case shouldn’t even proceed to court. Though either way, this bitter legal battle is certain to hinder the streaming service’s long term ambitions, in that it makes it less and less likely that the majors will ever license the platform, which may put off future investors, especially if the record and movie industries start lobbying in Washington for new obligations to be added to the takedown provisions in the DMCA (which everyone expects them to).

Then there’s the global dimension, Grooveshark operates worldwide (though has voluntarily withdrawn from the German market after a spat with collecting society GEMA), and outside the US the takedown system defence does not apply, hence the Danish courts ordered an ISP there to block access to the streaming site. If the majors lose this one in the US courts, you can expect them to put the pressure on elsewhere instead.

And this is all relevant, because – according to internal emails between Grooveshark execs presented as part of Universal’s lawsuit – the digital firm’s grand plan is that eventually it will be such a big operator the major labels will have to play ball. But while it’s true that the big rights owners were able to forgive past infringing ways when doing deals with some of the early digital platforms, YouTube among them, the labels seem less inclined to be forgiving these days, even if there are commercial advantages to forgiving, forgetting and doing a deal. And that ‘no deal’ resolve will only strengthen the more bitter and bitchy this legal squabble gets.

The majors are yet to response to Grooveshark’s submission.



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