The Justice Department joined the entertainment industry's fight against illegal file-sharing Wednesday, saying it had launched an undercover criminal probe of a members-only group that allegedly traded movies, songs, games and software over the Internet.
The feds' move came as major record companies expanded their attack on file sharers who use Kazaa and other popular public networks. The Recording Industry Assn. of America said it had filed copyright-infringement lawsuits against 744 as-yet unidentified file sharers, bringing the total sued to 4,680.
The actions by the Justice Department and the RIAA directly affect a tiny fraction of the millions of file sharers who copy songs, movies and other works from one another's computers. But the two developments signal that the legal risks of unauthorized file-sharing are intensifying and spreading to more segments of the Internet.
John Malcolm, who left the Justice Department this year to lead the Motion Picture Assn. of America's anti-piracy efforts, said Wednesday's announcement by Atty. Gen. John Ashcroft sent an important message that even private file-sharing groups, such as the one targeted Wednesday, weren't anonymous.
"I would not assume that this is a surgical strike, if you will, and the investigation won't head off into other peer-to-peer systems," he said.
File-sharing networks have been a haven for pirates ever since the pioneering Napster software enabled people to copy songs for free in 1999. Despite thousands of lawsuits and cease-and-desist letters by the entertainment industry, file-sharing on public networks has grown fairly steadily, according to BigChampagne, a Los Angeles-based firm that monitors the networks.
The major movie and music companies have pressed the Justice Department to bring criminal charges against file-sharing pirates, hoping that the threat of federal prosecution would be a more effective deterrent.
Announcing the department's first steps in that direction, Ashcroft said the FBI had executed search warrants Wednesday in Texas, New York and Wisconsin against five people and an Internet service provider linked to a group known as the Underground Network.
No charges were filed, but agents seized computers, software and related equipment in the raids.
The estimated 7,000 members of the Underground Network use a program called Direct Connect to link their computers to online hubs, which enable them to share files with other people connected to those hubs. As of Aug. 2, each of the five hubs singled out by the FBI had a few hundred users who were sharing more than 6.4 terabytes of data -- enough to contain thousands of movies, songs, video games and programs.
An FBI affidavit alleged that an undercover agent who joined the group and used the hubs found evidence of a conspiracy to commit criminal copyright infringement. The charge carries a maximum penalty of five years in federal prison and a $250,000 fine for a first offender.
The latest round of RIAA lawsuits also broke new ground, bringing the record companies' first claims against users of the popular EDonkey software. So far, 836 people have agreed to settle claims brought by the RIAA, paying an average of about $3,000 each.