Napster Investors To Face Music In Court

Next Tuesday, music labels and publishers will face off against Bertelsmann AG in federal court in San Francisco over claims the German media company’s 2000 investment in Napster kept the file-swapping service operating eight months longer than it would have done otherwise.

The lawsuits claim the extra lease on life promoted wide-scale piracy and cost the music industry $17 billion in lost sales.

The Bertelsmann cases were first filed in New York, while Vivendi Universal’s Universal Music and EMI Group Plc also sued venture capital firm Hummer Winblad in Los Angeles, claiming its $15 million investment and installation of a chief executive at Napster in 2000 also promoted piracy.

Read the full story at Reuters.