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Secret Kazaa Documents Revealed in Court

Dan Warne writes "A fascinating range of Kazaa's internal documents were revealed in Federal Court in the ongoing court case against the Australian-based company today. One extraordinary philosophical manifesto by the company's chief technical officer showed that he was aware that Kazaa's activities were a huge legal risk. He also feared being 'out-innovated' by other P2P programs that didn't come bundled with adware. "if consumers can connect to FT (as well as Gnutella 2, eDonkey and Bittorrent) and it has no ads or adware then it would seem a good choice," Philip Morle says in the his manifesto. The documents are full of all sorts of other admissions-that-you'd-be-crazy-to-put-on-paper like how Kazaa employees "hate" installing the Kazaa Media Desktop on their machines because all the bundled adware slows your machine down and can hijack your web browser."

18 of 273 comments (clear)

  1. article text by Anonymous Coward · · Score: 4, Informative

    just incase of the slashdot effect:

    The Sale of Kazaa

    Team Sharman came to court today with a strategic shift in direction: the revolution would now be a secret.

    Their legal team presented a draft set of undertakings designed to suppress non-confidential documents from the media. It could have been a great plan if the Judge didn't think it was so crap, and with no supporting evidence for the basis of claim to confidentiality, Judge Wilcox swept away the majority of the claims for confidentiality by Altnet and Sharman.

    There were 30 Altnet documents and four Sharman documents they didn't want publicised. We'll go through the Sharman documents today, and the Altnet documents later in the week.

    The first item for discussion here at the Daily Dispatch is a 28 page contract between Kazaa B.V and Sharman, titled: Agreement for the Sale and Purchase of the Business and certain Assets of Kazaa B.V.

    Buried within the most standard legal contract that makes you want to stab your eyeballs out, are the following nuggets of information.

    When Kazaa's original Dutch owners got the jitters from pending US litigation by the music industry, the company was sold to Sharman for 600,000 Euros (about $1 million) to be paid in three installments. The purchase price included all company assets for the provision of p2p enabled software (which includes advertisement space for display advertising) to let users search and download files from other users.

    Plus, all business and registered intellectual property rights, confidential information (defined as processes, methods, formulae, financial data, customer and supplier lists, marketing information, test results and reports, project reports, testing procedures, development manuals, training manuals, market forecasts, sales targets and stats, price sensitive information, research reports, business development reports), and all Internet domain names.

    Bored yet? The sale took place in the Amsterdam offices of Van Doome at De Lairessestraat, and following the sale, Kazaa BV would have to change its name. Sharman was indemnified against all debts and liabilities and blah blah blah standard contract stuff. All employees were sacked after the sale (nice). Kazaa B.V ensured there was no Trade Union agreements or disputes in place at the time of sale. If there was, the leftie bastards would understand anyway, because every revolution starts a bit nasty. Of course, today Sharman enjoys the full support of a devoted staff that would never be treated so shoddily by their benevolent bosses if there were cause to up and move from a jurisdiction under legal duress. It's a revolution, it's Us against Them, it's Mabo, it's the vibe of the thing.

    The Sales Agreement further confirms that when all employees were sacked, there was no way anyone could come back and haunt them to "assert any moral right in respect of any Business Intellectual Property Right." And if they did, then Zenstrom and Friis would be stung for it, not Sharman. So I'm guessing all employees were made to sign a contract as thick and dense as this one to make sure they kept quiet.

    The original owners, Niklas "Skype" Zennstrom and Janus Friis were forbidden from competing with Sharman in any way for 3 years.

    The deal was to be kept secret and not announced without the written consent of Sharman. The Sales Agreement was construed in accordance with the laws of England and subject to the non-exclusive jurisdiction of the English courts.

    There were two clauses that seemed a bit odd. Under Schedule 3 of Vendor Warranties is the subheading Litigation. Clause 5.1 says:
    Save as disclosed in the Litigation Letter, the Vendor (Kazaa B.V) is not a plaintiff or defendant in or otherwise a party to any litigation relating to the Business, which are in progress or threatened in writing or pending against the Vendor. So far as the Vendor is aware, no governmental or official investigation or inquiry concerning the Vendor is in progress or pending.

    Th

  2. Re:Sure there ain't no spyware... by tabkey12 · · Score: 5, Informative
    Note that their Skype website says: No Spyware, Adware or Malware
    Kazaa says: No Spyware

    Spot the difference, people!

  3. Re:Currently... by dioscaido · · Score: 5, Informative

    Because they have "adware", not "spyware". A ridiculous distinction that allows many companies to morally justify their inclusion of such horrible pieces of code in their products.

    Just peek at Messenger Plus v3 (an add on for MSN Messenger) -- they include LOP in their installer, which hijacks your browser, your searches, adds a toolbar, and adds icons to your desktop, and is one of the most annoyingly difficult things to clean on your own. The Plus 'company' justifies it in that it's "adware", not "spyware", and that the user opted in when installing by not un-checking the default install option. What comes next is a hellish exercise of peering into the most obscure parts of the registry to kill the re-spawners that make the spyware^H^H^H^Hadware come back on reboot when things look clean. /end rant

  4. Re:And slashdot keeps advertising skype, by Anonymous Coward · · Score: 5, Informative

    It's hard to take the word of someone who is stating incorrect information.

    Skype is created by the original developers of Kazaa, but the original developers did not include any spyware/adware in KaZaa. The spyware/adware was added to Kazaa after it was sold to Sharman.

  5. OK, bear in mind by ArbiterOne · · Score: 2, Informative

    Bear in mind that these aren't the Halloween Documents. The article, for those who refuse to RTFA, is basically a summary of the documents- not the documents themselves. They don't say "we're selling a product which we know is poisoning people's computers", that's sort of implied across the board. But they still don't come right out and say it.

  6. Re:Sure there ain't no spyware... by nilenico · · Score: 2, Informative

    But Skype isn't Kazaa! Skype are the folks who invented the basics (or whatever) of Kazaa, before it was sold out by a "friend" to the current bloatware Kazaa company... (See earlier thread about Skype.) And yes, this is probably Off-Topic.

    --
    .sig? No.
  7. Re:Sure there ain't no spyware... by elleomea · · Score: 2, Informative

    " Note that their Skype website says: No Spyware, Adware or Malware"

    Except it's not their Skype website. The creators of Kazaa and Skype sold Kazaa off to the current owners quite a while ago.

  8. Re:Currently... by Durzel · · Score: 5, Informative
    Straight from the installer's mouth.. What you agree to install...

    Step 1 of 4

    Kazaa file sharing application with: Bullguard Virus Protection, Altnet Topsearch.

    Kazaa is a free download supported by advertising from Cydoor, the GAIN Network and InstaFinder.

    Altnet PeerPoints Manager Package, an application that rewards you for sharing on Kazaa including My Search Toolbar and P2P Networking Application.

    Sharman Networks respects your privacy. Read the privacy policy. You must also agree to the user license agreements linked from below before continuing.

    [ ] I agree to the Kazaa Media Desktop End User License Agreement and Altnet PeerPoints Manager Package End User License Agreements.

    Seems it's just as polluted with spyware as it has always been.

  9. Eat your own dogfood by EvilTwinSkippy · · Score: 5, Informative
    Eat your own dogfood might be a better expression to describe it.

    A lot of tech companies use it to describe th practice of using their own products in house. That's also where to discover many of the problems that infuriate customers.

    --
    "Learning is not compulsory... neither is survival."
    --Dr.W.Edwards Deming
  10. Re:VMware! by vadim_t · · Score: 4, Informative

    Ha.

    I'd say I'm far from stupid - not a genius of course, but I do enough knowledge to administrate Unix and Windows systems, and write software. Yet I can't keep a Windows box spyware and virus free, unless that's specifically my objective.

    I mean, it's certainly possible, if what you aim for is a spyware free box. Yes, I can use vmware, every virus and spyware scanner, try to make sure everything I install is 100% safe, and perhaps get a clean and hopefully useful box out of it. But no normal user does that, myself included. I'm certainly fairly paranoid and won't install random crap from the net, but nice looking useful tools can have spyware too.

    If you want a real example, here's one. Go to this Azureus page. Well, actually that's not the Azureus page. It's a page that some jerks set up where you download spyware. The real page is on SourceForge.

    The cost of forgetting to look with a critical eye at the fake page is to have your system infected with all kinds of crap that will then pretty hard to remove. And it's pretty hard, mind you. I could fairly easily have fallen for it, if I hadn't seen the official one before and wondered why they changed their design so much. Normal users don't run strings(1) on suspicious executables and google for information, though.

    Now, you could argue that this kind of thing applies to Linux as well. True. However, there's a critical difference: On any sane Linux distribution, the official release of Azureus will be a package. And if the user downloads the software on their own, it'd be installed in their home directory. At least, while running under your account such crap is limited in what it can do, and has it much harder to wedge into your system as to make it hard to remove.

  11. Re:Intellectual "property" by phats+garage · · Score: 2, Informative
    Intellectual property is similar to any other sort of property, ie., ownership. Its only an unnatural right if you look at programs and data as being meaningless streams of bytes. Once you realise that programs and other media like audio and video actually have a demand then you can make the leap that there is opportunity for supplying this demand. When ever there is demand that is met by a supply, you have a market. Since producing digital media is often considered a decent way to earn a living, society of course will support mechanisms that allow for rewarding media producers.

    Now this market for programs and media implies that there is a product or service, and in this case the product is in the form of copies of programs and media. The big hitch is of course that the cost of production is mostly in design, ie., producing the first copy. This is of course the biggest stumbling block intellectually for folks because they neglect to consider that often this design costs money which is then often recouped via sales of the published copies.

    The right to exclusively produce published copies is otherwise known as intellectual property.

  12. Re:Currently... by Spl0it · · Score: 2, Informative

    Actually you have to click yes or no. They do not 'assume' yes or no for you. So your comment implying that you have to uncheck something is completely untrue.

    --

    No, this is
  13. Re:Out of curiosity... by Xoo · · Score: 3, Informative

    If you install Kazaa with MS Antispyware running, it will install all of the spyware, but MS Antispyware will pickup about half of the spyware immediately after installation. To get rid of the rest, a thorough system spyware check will kill it.

    It's important to note that while you can kill the spyware bundled with Kazaa, if you modify the Cydoor installation, then Kazaa will cease to function.

    Here is a good website if you want to install "dummy" files to trick Kazaa and other adware software into thinking you have the spyware on your system, but really don't.

    --
    Karma police, arrest this man, he talks in maths....
  14. Re:Sure there ain't no spyware... by nanoakron · · Score: 2, Informative

    Just a heads-up on another program that says it doesn't come with spyware or adware:

    Mercora free radio client.

    MS anti-spyware spotted it trying to install the grokster adware bundle. Good catch.

    -Nano.

  15. Re:It just goes to show... by dutky · · Score: 3, Informative
    Eminence wrote:
    This sounds very rational. And this is probably what people should do. However, both the original poster and you assume that other fellow's lawyers' right to read anything that you've written is natural and obvious. But shouldn't there be a limit? If that would be technologically possible to subpoena someone's thoughts would you see it as natural and right? I really don't like the idea that anything I write or draw might be used against me - I thought this rule applied only to testimonies after being arrested.

    It is currently techologically possible to subpoena a person's thoughts: A witness can be subpoenaed to testify regarding their thoughts, and they are required by law to tell the truth. The only time your thoughts are protected (under the U.S. constitution) from testimony are when their revelation may incriminate you. If you commit your thoughts to physical form, however, they are subject to discovery just like any other physical object: should we be prevented from using a bloody knife as evidence simply because it is personal property of the defendant? If not, why should we exempt a written note?

    You may not like the idea that your scribblings may be used against you in court, but it is the case, and has been for many, many years. If you commit a crime, then write about it in your diary, or send a letter to a friend confessing to the crime (or bragging about it, or whatever), those confessions damn well aught to be able to be used against you: they are directly material to the prosecution of the case and there is no state interest in protecting such communication (as there is in protecting communication between spouses, doctors and patients and lawyers and clients).

    In the prosecution of almost any crime, there are two vital aspects that must exist: the actus reus (guilty act), and the mens rea (guilt mind). If the legal system can't attempt to substantiate mens rea, then we must either accept that no crimes can be prosecuted without a direct confession (completely unacceptable) or that intent is irrelevent to the crime (meaning that simple negligence would become criminal, also unacceptable).

  16. Re:Out of curiosity... by stinerman · · Score: 2, Informative

    Kazaa Lite K++ is still floating around the internets somewhere. I believe the last version was 2.4.3e (or something to that effect). One possibility is to install the latest Kazaa and try to download Kazaa Lite. Of course, you'd then want to uninstall the adware version and do a cleanup then install Kazaa Lite.

  17. Re:VMware! by brianber · · Score: 3, Informative

    A dead give away that Azureus.org isn't legit is that EVERY link on their page tries to install their software. What scares me is I'm sure a lot of people aren't experienced/ intelligent enough to catch that.

  18. Re:Sure there ain't no spyware... by stfvon007 · · Score: 2, Informative

    Sharman's No Spyware Commitment * Kazaa does NOT install or delete software from your computer without your permission. * Kazaa does NOT contain software that gathers personally identifiable information about you. * Kazaa and its partners securely process any credit card or transaction information you may give. * Kazaa does NOT contain software that monitors keyboard strokes. * Kazaa does NOT deceptively install software that centrally records your personally identifiable internet usage. * Kazaa does NOT prevent your efforts to remove Kazaa. Note their careful wording. It does not say anything about changing your homepage, redirecting your searches, and the "personally identifiable" in the monitering of internet usage and information gathering. And authough kazaa dosnt prevent your efforts of removing it, it can make your computer have networking issues if it is removed, and even when removing kazaa, its so-called "not spyware" remains. The top one is a blatant lie, however they would probably say somthing allong the lines of "you gave permission by accepting the EULA"

    --
    All misspellings and grammatical errors in the above post are intentional and part of my artistic expression.