Napster Calls MusicNet Monopolistic; Judge Agrees

MattW writes "Yahoo is carrying an article from the AP about a development in ongoing Napster litigation. Several major labels and RealNetworks formed MusicNet. Napster complained about an anti-competitive clause in the contract they signed with MusicNet, and Marilyn Hall Patel, best known to this community for her stern condemnation of Napster, agreed, stating that MusicNet had all the hallmarks of an anticompetitive business. The article goes on to state that, "If the recording industry was found to have misused its copyrighted material, it might not be able to successfully pursue an infringement claim on those works.""

Comments

Re:Now they're on to something

[raresilk]

both legal remarks not exactly correct (nothing personal).

Under the Brooke Group case, decided by the US Supreme Court in about 1995, oligopolistic collusion to dominate a market can constitute an antitrust violation, even though none of the players has sufficient market power on its own to constitute a monopoly.

You're partially correct in that abusive business conduct might also form the basis for a RICO claim. However, you need certain specific "predicate acts" to support a RICO violation, and although criminal infringement of a copyright is a predicate act, misuse of a copyright is not. So I wouldn't be too quick to assume that this is just the "reverse Napster case" here.

RICO also comes in *both* civil and criminal flavors. Criminal RICO charges would have to be brought by the Justice Dept., and although the penalties sound scary, don't forget that the wheels of government turn slowly, and there's an awfully high burden of proof to convict someone of a crime. (And also, I suspect they're quite caught up in other stuff at Justice right now.)

In contrast, civil RICO claims can be brought by any individual/company who claims to have been "injured in business or property" by the RICO violation. A successful claimant is entitled to treble damages, so although it doesn't sound as threatening as criminal charges, civil RICO is no little mousie.