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Internet chief shrugs off hype surrounding lawsuit

Embroiled in a nasty dispute with the recording industry, CEO Michael Robertson assures investors that the acrimony will blow over soon.

    Lawsuit? What lawsuit?

    Embroiled in a nasty dispute with the Recording Industry Association of America (RIAA) and the five major music companies, CEO Michael Robertson said the acrimony will blow over soon. Robertson downplayed the lawsuit when he addressed analysts this afternoon at the Chase H&Q Technology Conference in San Francisco.

    Robertson began his bullish presentation by urging the roomful of investment bank representatives to buy stock, which has been socked by the lawsuit and closed today at $11.88--down 6.86 percent from yesterday and off 88 percent from its 52-week high of $105.

    He then joked, "Oh, and P.S., by the way, double asterisk: There's a lawsuit going on that I don't want to talk about."

    The RIAA and recording labels say an service dubbed, which allows Web surfers to gain access to full CDs online and to listen to them on any computer with Net access, violates their copyrights. Late last month, a federal judge agreed.

    Today, agreed to remove all major-label content from its controversial service. and the record industry have been engaged in settlement talks for the past several weeks, as the online company hopes to end the dispute without paying billions of dollars in damages. The industry has yet to ask the court to officially block access to its content online, but said it would act on its own to smooth negotiations.

    Robertson, after his 24-minute exhortation about how sound an investment is, briefly returned to the aforementioned unpleasantness. But he refused to give the lawsuit much credibility.

    "Any new media device has faced legal challenges," Robertson said. "We think the higher courts, which are more apt to make new law, will rule in our favor...This is a case of technology outrunning copyright law."

    Despite his optimism, Robertson said he was eager to settle the dispute out of court.

    "I cannot spend three years in court. We're very motivated to create a business resolution," he said. "We've been in talks for four weeks, and I'm cautiously optimistic for a resolution."