* LimeWire told to disable software functionality
* Music body says LimeWire enriched itself through piracy
* Damages potentially "staggering," to be set at trial
* LimeWire had more than 50 million users in 2009
(Adds details from ruling, second byline)
By Yinka Adegoke and Jonathan Stempel
NEW YORK, Oct 26 A U.S. federal judge on
Tuesday granted the music industry's request to shut down the
popular LimeWire file-sharing service, which had been found
liable for copyright infringement.
The ruling by Judge Kimba Wood in Manhattan federal court
halts one of the world's biggest services for letting consumers
share music, movies and TV shows for free over the Internet.
Saying that LimeWire's parent Lime Wire LLC intentionally
caused a "massive scale of infringement" involving thousands of
works, Wood issued a permanent injunction that requires the
company to disable its "searching, downloading, uploading, file
trading and/or file distribution functionality."
Record companies "have suffered -- and will continue to
suffer -- irreparable harm from Lime Wire's inducement of
widespread infringement of their works," Wood wrote.
She called the potential damages "staggering," and probably
"well beyond" the New York-based company's ability to pay.
The signed ruling was made available by The Recording
Industry Association of America, which represents music
companies. It has said Lime Wire has cost its members hundreds
of millions of dollars in revenue. A copy of the ruling was not
immediately available on the public court docket.
In a statement, Lime Wire expressed disappointment at the
ruling. "While this is not our ideal path, we're working with
the music industry to move forward," it said.
Lime Wire said the injunction lets it continue testing a
service that allows users to buy music from independent labels.
The company said it hopes to negotiate agreements with the
entire music industry ahead of a full launch.
Founded in 2000 by Mark Gorton, Lime Wire has been a thorn
in the side of record companies because millions of fans used
it as an easy means to find and download music for free.
U.S. recorded music sales have fallen in value to $7.7
billion in 2009 from $14.5 billion in 1999 according to the
RIAA. The music industry blames online and physical piracy as
the primary reasons for the decline.
"MASSIVE PIRACY" ALLEGED
Tuesday's injunction "will start to unwind the massive
piracy machine that Lime Wire and Gorton used to enrich
themselves immensely," the RIAA said in a statement. It said
the court will consider damages at a January trial.
The RIAA represents labels owned by Vivendi SA's (VIV.PA)
Universal Music Group, Sony Music Entertainment (6758.T)
(SNE.N), Warner Music Group WMG.N and EMI Group, owned by the
Terra Firma [TERA.UL] private equity firm.
LimeWire has said it has more than 50 million monthly
users. These users accounted for 58 percent of people who said
they downloaded music from a peer-to-peer service in 2009, a
survey by NPD Group showed.
As technology and broadband speeds have improved, LimeWire
has also been used to illegally share movies and popular TV
shows, attracting criticism from Hollywood as well.
Wood's decision to shut the LimeWire service followed a
unanimous 2005 U.S. Supreme Court ruling against file-sharing
service Grokster Ltd.
In that ruling, the court said companies could be sued for
copyright infringement if they distributed services designed to
be used for that purpose, even if the devices could also be
The case is Arista Records LLC et al v Lime Group et al,
U.S. District Court, Southern District of New York, No.
(Reporting by Yinka Adegoke and Jonathan Stempel; Editing by
Steve Orlofsky, Bernard Orr)