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Record Labels Conduct Raid in Australia

Investigators, targeting Kazaa, search the homes of Sharman Networks executives for signs of copyright violations.

February 07, 2004|Jon Healey, Times Staff Writer

The major record companies picked a new fight Friday with the people behind the Kazaa file-sharing network -- this time hitting them where they live.

The anti-piracy arm of the Australian recording industry raided the homes and offices of two top executives of Sharman Networks near Sydney, searching for evidence that they violated copyrights by distributing Kazaa software.


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Australian investigators also raided four Internet service providers, three universities and the home and office of Kevin Bermeister, chief executive of Brilliant Digital Entertainment, a company that uses Kazaa to distribute authorized copies of music, games and movies.

The major labels, which blame Kazaa and similar file-sharing programs for promoting online piracy, have sued in U.S. courts to shut the networks down. In the United States, the record labels also have filed copyright-infringement lawsuits against more than 900 people who use the networks.

Friday's operation, though, marked the most invasive tactic yet against those behind Kazaa. It was mounted by Music Industry Piracy Investigations, a group funded by the Australian divisions of the five major record companies -- Universal Music Group, Sony Music Entertainment, Warner Music Group, BMG Entertainment and EMI Group -- and a large Australian label, Festival Mushroom Records.

Australian law allows people preparing copyright lawsuits or other civil claims to conduct surprise searches if they can convince a high-court judge that evidence might otherwise be destroyed.

The raids prompted a volley of recriminations from Sharman and its allies, which accused the labels of making desperate moves to harass and intimidate Sharman -- incorporated in the South Pacific tax haven of Vanuatu but run by Australian entrepreneur Nikki Hemming. Hers was one of the homes searched.

Sharman attorney David B. Casselman accused the recording industry of "trying to do an end run" around its pending case against Sharman in U.S. District Court in Los Angeles. Under Australian law, a company commits piracy when it authorizes someone else to violate copyrights, potentially giving the labels a lower threshold to meet than they face in U.S. courts.

Courts in the Netherlands already have validated the Kazaa software. And the case against Kazaa in the United States suffered a setback last year when the presiding judge, Stephen V. Wilson, ruled that two similar file-sharing networks did not violate copyright law.

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