Jailtime Seems A Bit Harsh For Online Music Store Owners Who Didn't Get All The Right Licenses

from the why-not-just-make-them-pay-up? dept

Fri, Jan 30th 2009 12:02pm — Mike Masnick

Most readers here probably know the story of Allofmp3.com -- a Russian website that signed a licensing deal with a Russian music licensing group ROMS. The site was immensely popular because (a) it sold un-DRM'd files (back before that was common) and (b) sold music incredibly cheaply. The recording industry should have taken this as a lesson in how to create a super popular online music store -- but instead it freaked out, and nearly created an international diplomatic incident in threatening Russia with economic sanctions unless it shut the site down. The problem was that since it had the ROMS license, it was legal in Russia. In fact, Allofmp3.com even tried to pay the record labels some money -- which they refused. The record labels, of course, insisted that the ROMS license wasn't sufficient, but no Russian court ever agreed. Eventually the site was shut down, though it lives on at MP3Sparks. However, it's lost a lot of steam because the site has been blocked from accepting most common forms of payment.

Law Professor Michael Scott points us to the news of what appears to be a similar offering in Italy -- except that, in this case, the operators of the site have been sent to jail. The only news that I can find on this is from the IFPI site -- which is obviously a bit biased, but it does look like the owners of the site did get a license from the Italian Authors' Society (SIAE), which they believed was sufficient. A lower court agreed, but the appeals court has sided with the record labels.

But here's the kicker: the operators of the site have now been sent to jail for criminal copyright infringement. Already I have problems with most criminal copyright infringement cases -- because, by any reasonable standard, copyright is a civil dispute -- it's an issue between two businesses. In this case, it's even more egregious because it seems clear that the site wasn't just some random guy selling MP3s he had no right to, but had clearly tried to obtain the correct licenses. However, these days, when to do just about anything with music you need to get numerous different licenses (Peter Jenner, back at MidemNet, claimed that you needed 33 different permissions to do pretty much anything with music in Europe, though others disagreed), it seems fairly ridiculous to throw someone in jail for not being able to figure out every single party that has to sign off on something -- especially when you were lead to believe that you had what you needed via the Authors' Society.

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Filed Under: copyright, downloads, italy, jail, licenses
Companies: ifpi

24 Comments

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:Lobo Santo, 30 Jan 2009 @ 12:20pm

Gangster?
Fella from Italy?
Maybe the IFPI out there is in the Mafia's pocket...
Come to think of it, maybe the RIAA and MPAA are in the Mafia's pocket...
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Jesse, 30 Jan 2009 @ 12:20pm

How is copyright good for the market? I sure as hell wouldn't want to get into a market where I could put in every sincere effort to follow the rules and still end up in jail.
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Anonymous Coward, 30 Jan 2009 @ 12:31pm

Re:
It's never been good for the market. In the US the only reason it was there is as a motivating factor. Saying to inventors: HEY! Create something and we'll let only you have control over it for a little bit. If you're smart you can make yourself a lot of money! Then after a bit it was to go to the public domain and *anyone* could use it.

But no, not anymore. Went from Win-Win compromise to Win-FuckedWithARake. The first win is for the copyright holder, while everyone else is the later.
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:Lobo Santo, 30 Jan 2009 @ 12:40pm

Re: Re:
Man, I hate it when the judge at my trial says "FuckedWithARake" as my sentence when I lose.
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TEA-Time, 30 Jan 2009 @ 12:44pm

Re: Gangster?
The term MAFIAA was used long before they "came up with it themselves".

http://mafiaa.org/
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Trerro, 30 Jan 2009 @ 12:50pm

Originally, copyright was a good thing. It gave you a TEMPORARY license to have full COMMERCIAL control over a creative work, ensuring that some big company couldn't just take it and use their larger budget to take all of their profits. This was obviously useful, especially if you were one guy with a good idea looking to get established.

The problem is that copyright law has been twisted to the point that it's not even remotely aimed at its original intent. Copyrights now last until death + I think 75 years, and infringement penalties, instead of being based on actual lost profits, are based on punitive fines that involve treating them as a criminal rather than a civil matter. If you illegally share music to a few dozen people, you've done maybe $100 of "damage", not hundreds of thousands.

This problem is compounded by our broken legal system. A large corporation can force anything they want out of existence by simply threatening to sue. It doesn't matter if, even WITH our terribly modified copyright laws, they don't have a case in court. They present you with the choices of:
-fight them in court, lose because you can't afford a real lawyer, and incur so much legal debt on top of it that you go out of business
-take down the content, even though it isn't infringement
It's not much of a choice to say the least.

Unfortunately, it doesn't look like there's going to be a solution any time soon. It doesn't matter that pretty much everyone who know anything about copyright wants it returned to how it used to be... Hollywood owns too many senators for it to ever happen. Hopefully that'll change as the public gets increasingly disgusted over losing stuff they paid for to DRM... but I don't think we'll see real change any time soon.

Long story short though, copyright itself is fine... it's what we've done to it that's the problem.
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ChurchHatesTucker (profile), 30 Jan 2009 @ 1:02pm

Seems clear
Deal only with RIAA-free artists if you want to avoid jail.
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Tiger, 30 Jan 2009 @ 1:57pm

The Music industry can suck balls.
They are more corrupt and greedy than Wall Street!
T
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Claes, 30 Jan 2009 @ 1:59pm

"by any reasonable standard, copyright is a civil dispute -- it's an issue between two businesses"

Is "between two businesses" really a good way to describe a hoard of music industry lawyers against some random individual without financial muscles whose actions where not commercially motivated?
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saru, 30 Jan 2009 @ 2:08pm

Allofmp3 = Legalised Theft
Allofmp3.com is (in my view) a criminal operation that does not pay artists for the music they sell. They sell music that they have no rights to and keep all the profits. How do I know this? Because they have music that I released on CD-Rs (!!) that were mailed directly to fans - they have those exact CD-Rs, with the CDs themselves scanned in as artwork, for sale on their site. They have no license, no permission, and have not provided any accounting of sales. All attempts to have them remove the content have been ignored. Allofmp3.com are thieves and deserve any punishment they get. I am an independent artist with no affiliation with (or love for) the RIAA. But in this case, I think they got it right.
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Anonymous Coward, 30 Jan 2009 @ 3:31pm

Great, just when I decided to start a new online music business that will eventually lead to it being a middleman for selling it.

Seriously? 33 licenses? and here I thought permission from the label and artist was enough for any reasonable person
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Doh, 30 Jan 2009 @ 5:24pm

Re: Allofmp3 = Legalised Theft
You do realize that the ones in jail (Italians) are not affiliated with Allofmp3 (Russians) - right ?
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Anonymous Coward, 30 Jan 2009 @ 7:00pm

Not sure why allof/mp3sparks don't simply get a new business-number or open up sub-holdings to accept visa/mastercard/paypal/etc; it would probably be rather easy to acquire a bulk-discount of numbers and implement a revolving door script to rotate between them say bi-monthly.
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PaulT (profile), 31 Jan 2009 @ 12:18am

Re: Allofmp3 = Legalised Theft
While it's a shame that you feel your music was handled improperly, the whole issue about AllOfMP3 is that is WAS LEGAL - under Russian law. The loophole exploited by the site was that they did not need to get permission from artists before selling music, as long as they had a ROMS licence.

So, what you're supporting is US law being enforced on other countries because you're not comfortable with the way they do things. It's sad that you think this way.

In the meantime, stop looking at the negative aspects of the case, and look to the positive. How many people have heard your music because of the downloads from that site? Are they people who would have otherwise downloaded your music?

Here's an interesting piece of information, by the way: I hadn't heard of you before you posted this message. However, from looking at your site, I see that I have a remix of yours as part of a compilation that I downloaded from AmieStreet (4th On The Floor by West Indian Girl). I haven't listened to the "disc" that your remix is included on, but I'll do that this weekend. If I like the remix, I may well go on to download more of your music, and you'll get my money. All because you complained here about AllOfMP3 - not bad, huh?

By the way, have you ever considered putting your music up for sale on independent sites like eMusic or AmieStreet? You seem to have numerous remixes on those sites but none of your actual albums - a missed sales opportunity IMHO.
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PaulT (profile), 31 Jan 2009 @ 12:25am

Re:
Sadly, the 33 licences is what's required to get that permission (different labels in different countries, different types of renumeration for each, etc.).
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Lawrence D'Oliveiro, 31 Jan 2009 @ 12:29am

Re: Allofmp3 != Legalised Theft
saru proclaimed:

Allofmp3.com is (in my view) a criminal operation that does not pay artists for the music they sell.

Actually, they did try to pay, but the money was refused. It says so in the article—you did read the article before shooting your mouth off, didn’t you?
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Anonymous Coward, 31 Jan 2009 @ 1:40am

Re:
Nah, it's too late for that. Most of their customers have probably gone out to find free, "pirated" music and now the recording industry and poor starving artists get fuck all.
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Not so anonymous coward, 31 Jan 2009 @ 8:05am

Re: Re: Allofmp3 != Legalised Theft
This blog really needs to get the facts. ROMS did not have any licenses legal or otherwise, from master recording owners that allowed what they did with the internet site allofmp3. Further investigation showed that the site was owned and run by the Russian mob. That is why American Express, Master Card and Visa stopped dealing with them. You think the record industry (RIAA) gives orders to the likes of those companies? If you do, you are really "record industry" paranoid.
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Anonymous Coward, 31 Jan 2009 @ 8:16am

Re: Re: Re: Allofmp3 != Legalised Theft
"You think the record industry (RIAA) gives orders to the likes of those companies?"

No, of course not.

1) The RIAA and friends go whining to Congress.
2) Congressional critters then make suggestions to said companies.
3) Said companies tow the line
4) PROFIT !!!
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Anonymous Coward, 31 Jan 2009 @ 11:17pm

Re: Allofmp3 = Legalised Theft
Because they have music that I released on CD-Rs (!!) that were mailed directly to fans - they have those exact CD-Rs, with the CDs themselves scanned in as artwork, for sale on their site.
OK, I'm taking what you said at face value and accepting that the CD-Rs they are offering for sale are indeed the exact ones that you sent to fans (and not copies thereof). Now you need to understand a few things. First, Allofmp3 is no longer selling music. Second, Allofmp3 was in Russia and, believe it or not, US laws don't apply there. Third, even if they were in the US, there is something in the US called the "first sale doctrine" which would make it perfectly legal for them to resell those CD-Rs.

They have no license, no permission...
The courts there said otherwise.

... and have not provided any accounting of sales.
How do you know there were any sales?

I am an independent artist with no affiliation with (or love for) the RIAA.
Maybe you need to come out of the closet.
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Anonymous Coward, 31 Jan 2009 @ 11:20pm

Re: Re: Re: Allofmp3 != Legalised Theft
Further investigation showed that the site was owned and run by the Russian mob.

And even further investigation has shown that the mob is run by the RIAA. So I guess they were legit after all.
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Gilbert, 1 Feb 2009 @ 10:26am

Change the name of DRM
Why doesn't the recording industry just do us all a favor and change the name of DRM and its ilk to "Fuck You Licensing".

They obviously think that as a consumer I have to live with whatever changing sets of ambiguous and inconsistent rules they set up in order to extort the maximum amount of money out of my attempts to listen to/watch/read/think about entertainment, so why won't they just be honest about it?

I'm willing to pay the pimps their share once, but to keep coming back to me and insist that I pay again and again feels like I'm getting screwed over and over.

Guess what guys? While you're trying to screw me over, someone on a different street corner is giving it away for free. Gee, I wonder where my money's gonna start going?

So, in the name of all of other fed-up consumers out there: Take your "Fuck You licensing" and shove it!
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Doug (profile), 2 Feb 2009 @ 7:52am

There's a funny thing about this
At the All Of MP3.com prices I would have spent the money to simply download copies of songs I already own rather than spending the time to rip them all manually myself. At $2 or so per disc this is feasible. At $10 per disc it's overpriced.

It's funny how the recording industry simply doesn't get that. So I spent a ton of time ripping and labeling all 300 of my CDs. And instead of the $600 they could have gotten from me for music I already bought they ended up with $0.
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Music Shop, 18 Mar 2009 @ 5:49am

If you take a look to the resource from IFPI, you'll see that it was only 3 months of jail. It's not that bad after all...
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