Napster Ordered to Shut Down

SAN FRANCISCO, July 26 -- A federal judge today ordered Napster Inc. to halt the operations of its phenomenally popular song-sharing Internet service, saying the upstart company was allowing copyrighted music to be pirated online.

The preliminary injunction, set to take effect at midnight Friday, would effectively shut down the company, whose service has more than 20 million users and has come to define the conflict between the openness of the Internet and intellectual-property rights.

U.S. District Judge Marilyn Hall Patel--siding with the Recording Industry Association of America, which brought the lawsuit last December--said she found "overwhelming" evidence that the www.napster.com World Wide Web site was created to allow music lovers to duplicate copyrighted works.

"That was the whole reason for Napster's existence," said Patel, whose ruling came after about three hours of arguments. "Look at their own business plans and what they told their own consumers they were doing."

Napster attorneys argued that the company violates no law and neither do its users, who the lawyers said are merely exercising their First Amendment rights to share recordings with other music lovers. Napster supporters say the recording industry is using copyright law to stifle new technology and maintain a marketing system that promotes a tiny fraction of the world's musical artists.

Napster attorney David Boies won the two-day reprieve to provide time to seek an emergency stay on the order from the 9th U.S. Circuit Court of Appeals in San Francisco. The recording industry agreed to post a $5 million bond should Napster eventually prevail. The injunction will be in effect until the case is decided at trial.

The case is being closely watched because of its implications for the resolution of future disputes between owners of copyrighted material and those who believe that the Internet should be a completely open medium for people who want to trade music, videos and other kinds of information. Patel's courtroom was filled to capacity, and today's hearing was piped in on video and audio to an overflow courtroom.

Several other lawsuits challenging similar technology used over the World Wide Web have been filed by the movie and music industry, but Patel's is one of the first rulings siding with the entertainment industry in a case involving new technology to share copyrighted files over the Internet. These cases, including separate suits against Napster by the heavy-metal band Metallica and rap artist Dr. Dre, could establish precedent for application of copyright law to online media sites.

Throughout her questioning, Patel systematically shot down Napster's key defenses, ultimately ruling that the internal documents and Napster's business plan were designed to make it easier for computer users to steal music over the Internet.

At the beginning of the hearing, when Recording Industry Association of America attorney Russell Frackman began his arguments, Patel interrupted and said of Napster, "It's the Microsoft of the industry, is it?" In response, Frackman said he had been trying to think of an analogy but couldn't. He noted that at its current rate, 3.6 billion separate illegal recordings had been downloaded from Napster to date.

"It is the most egregious case of massive copyright infringement that has ever existed," he said.

Patel suggested that the industry would prevail in the lawsuit. "I find the plaintiffs have established not only a reasonable likelihood of success, but have shown a strong likelihood of success on the merits," she said.

Boies, fresh from his victory for the government in the Microsoft antitrust case, faced harsh questioning of the defenses his legal team had posed on behalf of Napster.

"It was essentially a program created to facilitate the downloading of music and uploading of music," Patel said, "but pirating be damned is the sense that one gets" from the internal company documents.

Napster.com, founded less than a year ago by 19-year-old college dropout Shawn Fanning, provides Internet users with the ability to scan one another's hard drives for copies of musical works. In effect, it creates one database from the millions of songs stored in a file format known as MP3 on personal computers in dorm rooms, private homes and offices around the world.

Even with Napster out of business, people could use other programs to find and share music files. Some of those programs, including a new one called Gnutella, allow users to share files without going to a central directory, making it nearly impossible to shut down.

During today's hearing, Patel frequently cited the company's own documents, which noted that users would be drawn to the site to illegally obtain music for free and noted that even Napster executives had illegally downloaded music files on their own computers.

Boies unsuccessfully argued that the Supreme Court, in a case involving Sony Corp., ruled that new technology that was used for purposes that did not infringe on copyright and other intellectual-property rights was legal. In that case, the movie industry sued over the invention of Betamax videocassette recorders.

Patel resoundingly rejected the Sony defense and at one point accused Boies of taking the case out of context.

Patel also rejected the notion that Napster was primarily a vehicle for new bands to win exposure to the public. "Promoting new artists was not a chief strategy," Patel said.

Referring to uses for Napster that do not involve piracy, Patel said: "Many of them seem to be thought of after this litigation started."

The judge was particularly troubled by the scope and breadth of the community that accesses illegal files through the service.

"Remember, I went on Napster," Patel said. "About everything I saw was copyrighted."

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Napster Ordered to Shut Down