EMusic.com Takes On MP3.com In Copyright Lawsuit

At issue in the lawsuit, EMusic.com said, is the same online music
locker service that got San Diego, Calif.-based MP3.com in trouble
with the five major recording companies earlier this year. The
record companies successfully extracted multi-million-dollar
settlements from MP3.com after they complained the company
illegally copied their CDs to stock the music library of its
My.MP3.com service.

While four of the record companies settled out of court in pacts
that included licensing agreements thought to be valued in the
neighborhood of $20 million each, Universal Music stuck with its
case in a New York federal court and was awarded damages of more
than $53 million.

EMusic.com says it has exclusive digital rights to some 13,000
albums from a host of smaller record companies. Currently, the
company's offerings include a subscription service that allows
users unlimited downloads of music in CD-quality MP3 format for
just $9.99 a month. However, the company has been struggling to
get more-popular music from major labels online.

EMusic.com said it is not able to estimate at this time how many of
its partners' albums may have been copied for the My.MP3.com
service. It said the lawsuit currently includes as plaintiffs Fearless
Records, Fuel 2000 Records, Gig Records, Invisible Records, SpinART
Records and Victory Records. EMusic.com said it figures more
partner-labels may join the lawsuit later.

"Although MP3.com has entered into settlement agreements with
the five major record labels, they have chosen to ignore their
infringing actions with respect to independent record labels," Gene
Hoffman, EMusic.com's president and chief executive officer said in
a statement. "EMusic strongly supports the rights of music fans to
have access to convenient, inexpensive digital music - as well as
the rights of all labels and artists to choose how and where their
music is used."

Late last month, EMusic.com turned its sights on litigation-
embattled Napster, demanding that the music-swapping network
weed out MP3 files which originate at EMusic.com.

EMusic.com claimed it has developed tracking software capable of
detecting its own music within Napster's indices. It said it would
warn users it believed were trading music illegally, then request
that Napster block access to those who refuse to change their ways.

EMusic.com is at: http://www.emusic.com/.

MP3.com is at: http://www.mp3.com/.