HITS Daily Double
The very day Rakoff brushed aside MP3.com's allegations about UMG's intentions, a press release touted a UMG-affiliated service virtually identical in structure to My.MP3.com, over which the RIAA lawsuit was filed in the first place.


Seagram Chief's Testimony "Irrelevant" To Netco's Willfulness, Rakoff Rules; Dismissal Follows Grilling of Michael Robertson
It's been a trying couple of days for MP3.com.

After company head michael robertson',390,400);">michael robertson',390,400);">Michael Robertson's extended and difficult stint on the stand during the first phase of the netco's copyright-infringement trial--during which the court attempts to determine whether MP3.com's violation was "willful"--the defense suffered another setback today.

Seagram head edgar bronfman',390,400);">edgar bronfman',390,400);">Edgar Bronfman, Jr., whose company oversees Universal Music Group, the only remaining plaintiff in the RIAA-led infringement suit following settlement agreements between the other major labels and MP3.com, was called to the stand as a hostile witness today by MP3.com's counsel. After a fusillade of questions regarding UMG's alleged desire to drive the Web company out of business--and numerous heated replies--Judge Jed Rakoff dismissed Bronfman from the stand, declaring that it was MP3.com's intentions, and not UMG's, that were on trial and that the liquor and entertainment magnate's testimony was therefore "irrelevant," Reuters and others reported today.

"You think Mr. Bronfman and his company have a motive to economically damage the defendant," the Judge responded to MP3.com attorney Michael Carlinski. "You've presented no evidence of that, but assuming you did, it's irrelevant as far as I'm concerned."

Bronfman declined to comment to reporters after leaving the stand. But UMG seems to hold the advantage in Rakoff's court thus far, at least during the phase devoted to MP3.com's willfulness.

Yet--perhaps coincidentally--the very day Rakoff brushed aside the netco's allegations about UMG's intentions, a press release from Loudeye Technologies touted its partnership with UMG-affiliated netco musicbank, which will "provide secure, streaming access on-demand to consumers' personal music collections initially thrugh the Internet and later through multiple delivery channels" (see item on today's Double). This model is virtually identical in structure to My.MP3.com, which streamed users' music collections and based its security on a pre-existing CD database--the very database over which the RIAA lawsuit was filed in the first place (see story, 7/25).

Today's events compounded Robertson's ordeal on the stand, where the high-profile Net exec was grilled mercilessly by UMG attorneys, notably Harry Katz, who challenged Robertson's claim of "fair use" in the creation of the database as well as his public criticisms of Napster and other lightning rods of the online music space. On Monday, as we reported here, Judge Rakoff took Robertson to task for implying that MP3.com's users read its densely worded online documents regarding copyright.

MP3.com has claimed attorney-client privilege in its refusal to divulge the content of company discussions regarding the creation of the database. But Rakoff has expressed skepticism from the bench about the likelihood that Robertson and his fellow executives were unaware of the implicatons of their actions, even pointing to the Pho technology discussion group's mailing list--to which Robertson periodically contributed--as evidence that numerous experts on the subject felt such enterprises were in flagrant violation of copyright.

Internal e-mails from the MP3.com engineering department were also presented as evidence of the company's intention to flout or ignore copyright.

While speculation within the industry (slavishly reported by the geniuses at this publication) was that UMG and MP3.com might settle this week, such prognostication seems, for the moment at least, far-fetched. And whatever Rakoff's view of UMG's intentions, MP3.com could well face crippling damages--possibly in the hundreds of millions--if its copyright violations are deemed to have been willful.

MP3.com stock slipped .19 today to 8.44.