"Defendant's entire business amounts to nothing more than a
massive infringement of plaintiffs' exclusive rights under the
Copyright Act and New York law," says the law suit.
Arista, Warner Brothers, Capitol and Universal are amongst the
major companies behind the suit. It claims that Allofmp3.com
profits by selling music which they own the rights to without their
permission and without compensation.
When an online retailer sells music it typically pays royalties
to artists via a collecting society such as the Performing Rights
Society (PRS) or the Mechanical Copyright Protection Society
(MCPS).
Allofmp3.com says that it follows Russian copyright law and that
it pays royalties to a Russian collecting society, the Russian
Multimedia and Internet Society (ROMS). Record industry body the
International Federation of Phonographic Industries (IFPI) says
that the collecting society does not pay artists or record labels
any of those royalties.
ROMS itself says that the site is legal because it licenses it.
"Allofmp3.com's activity is quite legitimate," ROMS general
director Oleg Nezus told BBC Russia earlier this year. "The opinion
of foreign copyright owners is just that - their opinion."
The website sells mp3s of popular music at a steep discount to
normal prices. An album which would cost around £6 on iTunes costs
just 60p on Allofmp3.com, and the site is the second biggest paid
download destination for UK users, behind Apple's iTunes.
The lawsuit is being pursued against Mediaservices, the company
behind Allofmp3.com. It seeks a court order against the company and
also punitive and compensatory damages. UK music body the BPI is
already suing Mediaservices in the English courts.
Earlier this year credit card companies Visa and Mastercard
stopped processing payments to the site because of the alleged
infringements.
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