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August 2009

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Napster's $10 Million Bid for The Pirate Bay Rejected

by bernardo parrella

http://torrentfreak.com/napsters-10-million-bid-for-the-pirate-bay-rejected… Global Gaming Factory (GGF), the company planning to acquire The Pirate Bay, has received a bid of $10 million from John Fanning, the former Napster CEO and uncle of its founder, Shawn. Other interested parties have contacted GGF in recent weeks, but thus far, they have all had their multi-million dollar offers rejected. Earlier this week Wayne Rosso cast doubt over the ability of GGF CEO Hans Pandeya's ability to raise the funding for the Pirate Bay takeover. In a response to these allegations the board of GGF has revealed that there is more interest than some had expected. One of the parties that offered a 2 million dollar investment in the acquisition is John Fanning who operated Napster, one of the first mainstream file-sharing applications. In addition, the board revealed that Fanning offered GGF 10 million dollars for The Pirate Bay itself. John Fanning discussed his plans with Hans Pandeya in London but they did not reach an agreement. The 10 million bid on the site and its assets has been rejected and thus far there is no official deal closed on the 2 million investment offer. In addition to Fanning's offer, GGF has also received an informal bid of 16 million dollars for The Pirate Bay by an unnamed Russian company. This offer has also been declined, GGF's board announced. "The basis for a legal site has been placed and contracts are expected to be concluded shortly with a leading player in the entertainment industry. The development of the company is very positive, and goes as planned," Hans Pandeya said in a comment.

Aug. 1, 2009

Joel Tenenbaum: RIAA wins $675,000, or $22,500 per song

by Irene Cassarino

After a brief deliberation, a federal jury has ruled that PhD student Joel Tenenbaum willfully infringed on the record labels' copyrights, awarding them $675,000 in damages, $22,500 for each of the 30 songs in question. Ars reports with reaction from Tenenbaum and his attorney, Harvard Law professor Charles Nesson. http://arstechnica.com/tech-policy/news/2009/07/o-tenenbaum-riaa-wins-67500… A Boston federal jury has ordered Joel Tenenbaum to pay a total of $675,000—$22,500 per song—to the major record labels for willfully infringing 30 songs by downloading and distributing them over the KaZaA peer-to-peer network. The figure is closer to the $222,000 award in the first Jammie Thomas-Rasset trial than the $1.92 million figure from the second trial. The verdict came down at late Friday afternoon after less than three hours of deliberation. When asked about the size verdict, Tenenbaum's attorney and Harvard Law School professor Charles Nesson told Ars that "it's a bankrupting award." He also felt things might have been different had they been allowed to argue Fair Use. "We were not allowed to speak to fairness," he told Ars. "I thought we had pretty damn good arguments on Fair Use." "I'm disappointed, but not surprised, but I'm thankful that it wasn't much bigger, that it wasn't millions," Tenenbaum told Ars after the verdict was announced. We asked him if he regrets not settling earlier on in the process. "Ask me in a couple of months," Tenenbaum replied. He also told Ars that he doesn't have the ability to pay the judgment and said that he'd be filing for bankruptcy if the award stands. Although the jury found that he willfully infringed on the copyrights in question, Tenenbaum said he was "not displeased with the jury considering how the trial went." What about the fact that the damages could have been much worse, as high as $4.5 million? "That to me sends a message that [the jury] considered [my] side legitimately," he replied. He was also evasive when asked if he regrets downloading music for free. "That's really a loaded question," he replied. "There are so many things that could have been different." The RIAA was pleased with the verdict. "We are grateful for the jury’s service and their recognition of the impact of illegal downloading on the music community," the RIAA said in a statement. "We appreciate that Mr. Tenenbaum finally acknowledged that artists and music companies deserve to be paid for their work. From the beginning that’s what this case has been about. We only wish he had done so sooner rather than lie about his illegal behavior." The trial was an almost entirely one-sided affair. Plaintiffs built their case with forensic evidence collected by MediaSentry, which showed that he was sharing over 800 songs from his computer on August 10, 2004. A subsequent examination of his computer showed that Tenenbaum had used a variety of different peer-to-peer programs, from Napster to KaZaA to AudioGalaxy to iMesh, to obtain music for free, starting in 1999. And he continued to infringe, even after his father warned him in 2002 that he would get sued, even after he received a harshly-worded letter from the plaintiffs’ law firm in 2005, even after he was sued in 2007, and all the way through part of 2008. And when he took the stand on Thursday, Tenenbaum admitted it all<http://arstechnica.com/tech-policy/news/2009/07/tenenbaum-takes-the-stand-i…>, including the fact that he had “lied” in his written discovery responses and at his first deposition in September 2008. Tenenbaum’s admissions were so clear-cut, and so damning, that Judge Gertner—who had recruited Nesson to represent the formerly lawyer-less 25-year-old—took the basic issue of infringement away from the jury, determining that no reasonable jury could find for Tenenbaum on that issue. The jury of five men and five women, all white and all from the Boston suburbs, were left only to determine the issue of willfulness and damages. Tenenbaum is only the second of approximately 18,000 individuals targeted by the labels to have gone to trial, and the second to lose. In June of this year, a Minnesota jury ordered Jammie Thomas-Rasset to pay $80,000 for infringing each of 24 songs, totaling $1.92 million. Last December, the labels announced that they were no longer initiating new cases against individual peer-to-peer users. However, they said they would see through to the end those cases already in the litigation pipeline<http://arstechnica.com/tech-policy/news/2009/03/hypocrisy-or-necessity-riaa…>. According to the labels’ attorneys, there remain about 100 cases pending where the defendant has filed an answer, about a dozen of which are being actively litigated in the discovery stage. The Tenenbaum litigation was dominated by the larger-than-life personality of Tenenbaum’s counsel, Harvard Law School professor, who infuriated the plaintiffs, and at times Judge Nancy Gertner, with his unusual litigation tactics. These included making audio recordings of the attorneys and the court, and then posting the results to his blog, and publicizing internal discussions with potential expert witnesses about legal strategy. A sanctions motion against Nesson for his recording practices remains pending. Tenenbaum’s case was dismantled piece-by-piece by a series of adverse rulings over the past several months. Judge Gertner dismissed his abuse-of-process claims against the plaintiffs and the Recording Industry Association of America; excluded four of his proposed expert witnesses and limited the scope of a fifth; and, in a coup de grace delivered less than eight hours before the start of trial, barred him from arguing fair use<http://arstechnica.com/tech-policy/news/2009/07/judge-rejects-fair-use-defe…>to the jury. Judge Gertner previously announced that she will hold a post-trial proceeding to determine whether the size of the award violates the US Constitution’s guarantee of due process of the law. While no federal court has ever invalidated an award of copyright statutory damages as constitutionally excessive, the record labels’ litigation campaign has spurred arguments that the Supreme Court cases imposing limits on punitive damages should be extended to statutory damages, which may contain a punitive element. Tenenbaum filed a motion to dismiss the plaintiffs’ statutory damages claim on constitutional grounds, but Judge Gertner deferred ruling on the issue unless and until there was actually a damages award handed down by the jury.

Aug. 1, 2009