File-sharing site eDonkey kicks it

P2P firm agrees to $30 million settlement in copyright case, becomes latest victim of illegal file-sharing crackdown.

The parent company of popular file-sharing network eDonkey has agreed to pay $30 million to settle a copyright infringement case brought by six music labels, according to court documents filed this week.

The settlement follows a federal district court ruling earlier this week that dealt what appears to be final blow to MetaMachine's peer-to-peer (P2P) client eDonkey; the eDonkey Web site has since been taken down.

A judge in New York's southern district ruled Monday that eDonkey facilitated illegal activity by allowing users to swap copyrighted material over the eDonkey2000 network. Another MetaMachine creation, a decentralized P2P network called Overnet, was also ruled illegal.

P2P networks have succumbed one by one since the U.S. Supreme Court ruled unanimously in June 2005 that file-sharing services were illegal. Some, like Grokster--the original defendant in the Supreme Court case--were snuffed out altogether. Others reemerged and questions about their viability remain unanswered. Still others, like BitTorrent, have not run into the same kind of legal roadblocks but are nevertheless making plans to cooperate with the entertainment industry.

MetaMachine founder Jed McCaleb and CEO Sam Yagan could not be reached for comment, leaving it unclear whether they have any plans to reopen their service in a piracy-free form. The eDonkey Web site is now replaced with a warning that reads, "If you steal music or movies, you are breaking the law. Courts around the world--including the U.S. Supreme Court--have ruled that businesses and individuals can be prosecuted for illegal downloading." Site visitors' IP addresses are logged and displayed to underscore that music pirates can easily be tracked down.

It should be pointed out, however, that while the New York-based company has been ordered to stop distributing the eDonkey software, existing users who already have the software can still connect to the eDonkey2000 network and swap files. Yagan and McCaleb, however, have been ordered to take action against this as part of the court settlement.

The Recording Industry Association of America is "pleased to have reached this settlement," organization CEO and Chairman Mitch Bainwol said in a statement. But he indicated that the fight is far from over. "The theft of music remains a major threat to the artists, record labels, legitimate online and mobile services," Bainwol said. "Our settlement with eDonkey will make operations such as Lime Wire that continue to break the law and profit off the back of stolen copyrighted content all the more conspicuous."

Plaintiffs listed in the case against MetaMachine included Arista Records, Atlantic Recording, Capitol Records, Elektra Entertainment Group, Sony BMG Music Entertainment, and UMG Recordings.

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