Record Industry Commences Court Proceedings Against Kazaa for Breach of Copyright

February 6, 2004

The Australian record industry has commenced proceedings in the Federal Court of Australia to stop the illegal copying of music via the Kazaa network. The proceedings follow a 6 month investigation by the music industry anti-piracy unit, Music Industry Piracy Investigations ("MIPI").

The proceedings, commenced in Sydney yesterday, will seek to stop the promotion, facilitation and authorisation of the illegal copying of music through the use of Kazaa's software and network in Australia.

Yesterday Justice Wilcox of the Fereal Court of Australia made orders permitting the record companies to obtain documents and other electronic records about Kazaa's activities in Australia. Pursuant to these orders representatives of MIPI, including computer forensic investigators, this morning attended 12 premises in three states where evidence was obtained that will be used in subsequent court proceedings.

Kazaa is the largest file sharing network in the world, facilitating the copying of millions of songs globally every day. Kazaa does this without seeking the permission of, or making any payment to, the creators and legal owners of the music that is copied.

The action was commenced in Sydney as Kazaa operates from offices in the Sydney suburb of Cremorne despite the fact that it operates through companies registered in Vanuatu.

Michael Speck, the General Manager of MIPI, said today:

"We have taken this action to stop the illegal use of music through the use of the Kazaa network."

"Kazaa has built a large international business through encouraging and authorising the illegal copying of music by users of the network. It authorises this copying without seeking the licence or permission of the owners or creators of the music, nor does it pay any royalties to either the owners of creators of the music."

"this is a simple case of a breach of copyright under the Copyright Act in Australia and we will, indue course, ask the Federal Court of Australia to order Kazaa to stop its illegal activities in Australia".

The matter will return to the court on Tuesday, 10 February 2004.

For enquiries and further comment please contact:

Michael Speck MIPI +61 28 569 1177 +61 412 696 653

Kazaa Background Information

Kazaa releasesd figures that last week 2.4 million people downloaded the Kazaa application worldwide.

More than 20 million users download Kazaa each month.

The software had been downloaded 230,309,616 times worldwide as at May 2003.

At any one time, there are about 3 million users simultaneously online and connected to the Kazaa network, sharing around 573 million files.

Over 850,000 tracks are made available by over 2,500 Australian users alone.

Based on US$0.99 retail price per downloaded track from authorised distributors, the retail value of unauthorised downloads through the Kazaa network exceeds US$2 billion per month globally.