>>> AllofMP3.com escapes criminal lawsuit, for now

>>> AllofMP3.com escapes criminal lawsuit, for now



On February 2004 the Computer Crimes division of Moscow City Police recommended that prosecutors initiate a criminal lawsuit against AllofMP3.com, a Russian music site selling MP3 downloads by the megabytes. The investigation was initially launched at the request of IFPI Moscow. The International Federation of the Phonographic Industry previously sued a similar Spanish project, with PureTunes.com settling with the industry for $10 million.

The case of AllofMP3.com was further complicated by compulsory licensing, adopted by Russian legislature. Compulsory licensing stipulates that licenses should be issued in non-discriminatory manner to anyone who wants to get one on reasonable terms. Russian Multimedia and Network Society was in charge of establishing the reasonable terms, and according to Russian legislation, anyone could distribute music, provided they track downloads and pay back some nominal fee. This is very different from the legislature in the United States, where a music distributor would have to gain a license before selling any music online, and furthermore, could be denied such license for whatever reasons.

On March 4th prosecutor’s office of Moscow’s Southwestern region refused to charge AllofMP3.com in a criminal lawsuit. What’s interesting is that AllofMP3.com did not win the case due to the compulsory licensing legislated in Russia. The prosecutor’s office affirmed that the Russian music site was distributing copyrighted music from its site, and in many cases did not have a proper license to distribute them. Russian criminal law severely punishes attempts to distribute copyrighted music without proper licensing procured first. However, Russian law is quite specific about distribution of material goods, as the law usually applies to CD and DVD pirating.

Moscow prosecutor’s office noted that Russian music site does not distribute material goods, and since is not subject to prosecution under the criminal law. AllofMP3.com distributed digital goods via Internet, of which Russian criminal law says nothing. Moreover, prosecutors arrived at the conclusion that since no physical copies of the goods are delivered to the customer, AllofMP3.com can be treated as a service where site visitors can listen to the music. (The fact that it’s more than possible to burn an MP3 to an audio CD apparently escaped law enforcement).

AllofMP3.com cannot be charged for piracy, prosecutors ruled, under the current criminal law. Which does not prevent musicians and labels from launching civil lawsuits for cases where AllofMP3.com sold copyrighted music and did not pay back the copyright holders. This is the most likely development for label lawsuits in the future, but they will be quite difficult to win if AllofMP3.com can prove it made all the necessary payments to ROMS. Another way, of couse, would be to change the current criminal law to introduce DMCA-like clauses that specifically relate digital distribution and distribution of physical goods. It’s no coincidence that Russian office of IFPI is located in Moscow’s Tverskaya Street, which is also the address for the parliament of the country.