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The distributor of file-swapping giant Kazaa on Friday welcomed a U.S. court’s ruling that two of its rivals are not legally liable for the songs, movies and other copyright works shared online by their users. Among other reasons for its landmark ruling Thursday, the 9th U.S. Circuit Court of Appeals said Grokster Ltd. and StreamCast Networks Inc. were not responsible because they don’t have central servers pointing users to copyright material. Nikki Hemming — chief executive officer of Sharman Networks, the Sydney-based company that distributes the immensely popular Kazaa peer-to-peer, or P2P, software — hailed the ruling as “a fantastic result for the peer-to-peer community. This ruling reinforces similar decisions in other courts around the world that P2P is legal.” She called on the entertainment industry to “stop litigating and start partnering with us. Legislation is not the answer, commercialization of P2P is.” Rod Dorman, lead trial counsel for Sharman Networks in the United States, said in a statement that Sharman would now seek a U.S. court ruling that the Kazaa software is legal. “This is a victory for the technology industry and fans, artists and owners of entertainment content,” he said. Sharman is involved in litigation in the United States and Australia over whether its Kazaa software, used by millions of computer users around the world, is responsible for copyright infringement. Dorman said the ruling also sent a message to file swappers “that they must use the software responsibly.” Dorman pointed out that the U.S. decision could not be used as precedent in Sharman’s Australian copyright infringement case, because U.S. and Australian laws are slightly different. “Regardless, the reasoning of the Ninth Circuit decision is powerful, sound and persuasive,” he said. “In addition, and more importantly, we are a global community and there should be consistent doctrines governing the application of copyright law to the Internet worldwide. I expect that the Australian court will consider the reasoning of the Ninth Circuit during its deliberations.” In February, investigators from the Australian recording industry raided the Sydney offices of Sharman and Hemming’s home, using rarely exercised search powers to hunt for evidence to support allegations of copyright infringements. The case is still before Australian courts. Late last year, the Dutch Supreme Court ruled that Kazaa’s Netherlands division cannot be held liable for copyright infringement of music or movies swapped using its free software. Copyright 2004 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.

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