Grooveshark copyright violations 'willful,' judge says before trial

Fri Apr 24, 2015 3:11pm EDT
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By Andrew Chung

NEW YORK (Reuters) - Online music streaming service Grooveshark could potentially have to pay hundreds of millions of dollars to major record labels after a U.S. judge ruled ahead of its trial starting on Monday that Grooveshark's copyright violations on nearly 5,000 songs were "willful" and made "in bad faith."

U.S. District Judge Thomas Griesa, who will preside over the trial in federal court in Manhattan, said in a court order on Thursday that because of Grooveshark's actions he will tell jurors they can choose to award the statutory maximum of $150,000 in damages per song.

Jurors also could decide to award less. But if the jury awards that amount, Grooveshark's parent company, Escape Media Group Inc, could be forced to pay more than $736 million.

Last September, Griesa ruled that Escape and its founders, Samuel Tarantino and Joshua Greenberg, were liable for the illegal uploads of thousands of recordings by artists such as Madonna, Eminem, Bob Marley and Jay-Z.

Griesa said the defendants had directed their employees to make the uploads in spite of the legal risk. The only question to be resolved at Monday's trial is how much Escape must pay as in penalties for the infringement.

Nine record companies including Arista Music, Sony Music Entertainment, UMG Recordings, and Warner Bros Records, sued Escape for infringement in 2011.

Griesa found in September that Escape's business plan was to exploit the copyrighted content in order to grow Grooveshark and then "beg forgiveness" from the labels.

Escape hopes to limit its losses at trial by arguing there were mitigating circumstances to the infringement, according to court papers. In Thursday's order, Griesa said he will allow the company to present evidence of its attempts to secure licenses from the record labels.   Continued...