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Piracy fighters raid offices of Kazaa, others

A judge in Australia authorizes a record industry group to search peer-to-peer companies including Kazaa owner Sharman and several ISPs, along with key executives' homes.

    A music industry group on Friday raided the Australian offices of peer-to-peer companies Sharman Networks and Brilliant Digital Entertainment, along with the homes of key executives and several Internet service providers.

    Music Industry Piracy Investigations obtained a so-called Anton Piller order Thursday from Justice Murray Wilcox, and began raiding premises in Queensland, New South Wales and Victoria on Friday searching for documents and electronic evidence to support its case against the peer-to-peer companies. The order allows a copyright holder to enter premises to search for and seize material that breaches copyright, without alerting the target through court proceedings.


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    In addition to the offices of Sharman Networks, which runs the Kazaa network, and Brilliant Digital Entertainment, MIPI raided the residences of Sharman Networks CEO Nikki Hemming, Brilliant Digital CEO Kevin Burmeister, and Phil Morle, director of technology at Sharman. Monash University, the University of Queensland and the University of New South Wales also were raided, as well as four ISPs including Telstra.

    "Telstra lawyers are presently working with lawyers from the record labels in order to determine exactly what information is being sought under the terms of the order," Telstra spokesman Warwick Ponder told ZDNet Australia. "We have not been asked for and will not provide any BigPond (an Internet access service) subscriber information.

    "Telstra has made it very clear for a long time now that it does not support copyright infringement or any other illegal activity. At the same time, Telstra clearly respects its obligation to protect customers' information and privacy under the Telecommunication Act and Privacy Act under federal law."

    MIPI general manager Michael Speck told ZDNet Australia that the order was specifically intended to gather evidence about the operators of the Kazaa network. "This is not about individuals; this is about the big fish," Speck said. "This is a signal that Internet music piracy is finished in Australia."

    The investigation into the Kazaa network has been ongoing for six months, and was precipitated by a significant change in the physical and technical infrastructure at Sharman, according to Speck. "The Kazaa operation infringes copyright within the terms of the Australian Copyright Act," he said.

    Sharman took issue with that claim.

    "This action appears to be an extraordinary waste of time, money and resources going over legal ground that has been well and truly covered in the U.S. and Dutch courts over the past 18 months," the company said in a statement. "This is a knee-jerk reaction by the recording industry to discredit Sharman Networks and the Kazaa software, following a number of recent court decisions around the world that have ruled against the entertainment industry's agenda to stamp out peer-to-peer technology."

    Sharman became a target for the music industry when it purchased the Kazaa peer-to-peer file-sharing technology from its Dutch creator, Kazaa BV, in 2002. It has had a long relationship with Brilliant Digital, and in 2002 had to defend against a backlash when it was revealed that spyware had been included with the Kazaa software. Brilliant Digital subsidiary Altnet was later formed and offered to pay people for hosting content on the Kazaa network.

    "Kazaa operators know the difference and make the decision as to whether they facilitate legitimate or illegitimate downloads," Speck said. "It's very clear they are facilitating and authorizing global copyright infringement."

    Sharman disagreed, claiming it bought the Kazaa software with the "express purpose" of creating a legitimate channel through which to distribute licensed, copyright-protected content.

    "There is no doubt this is a cynical attempt by the industry to disrupt our business, regain lost momentum and garner publicity," Sharman said. "The assertions by plaintiffs are hackneyed and worn out. It is a gross misrepresentation of Sharman's business to suggest that the company in any way facilitates or encourages copyright infringement."

    Monash University and the University of Queensland have challenged the order, and the arguments were expected to be heard Friday afternoon.

    Sharman, Australian subsidiary LEF Interactive and Brilliant Digital will face the record company lawyers before Wilcox on Tuesday.

    According to MIPI, which is part of the , there are around 3 million users simultaneously online and connected to the Kazaa network at any one time, sharing around 573 million files. More than 850,000 tracks are made available by over 2,500 Australian users. If each downloaded track were purchased for 99 cents--the going rate at sites such as Apple Computer's iTunes--the total would be more than $2 billion per month globally.