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Universal sues video sharing sites

But YouTube escapes action

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Universal Music Group (UMG) said it has filed law suits against two online video sharing websites, Grouper and Bolt, alleging copyright infringement.

The biggest sharing site, YouTube, escaped the writ because of a recent deal agreed with Universal.

The suit will stake a claim to damages of up to $150,000 for each example of copyright infringement; examples are believed to run into their thousands.

"Grouper and Bolt cannot reasonably expect to build their business on the backs of our content and the hard work of our artists and songwriters without permission and without compensating the content creators," a Universal spokesman said.

Universal has been the most aggressive of the four major music labels in its pronouncements on protecting its copyrights. Chief executive Doug Morris has in the past said that sites such as YouTube are mass infringers of copyright and vowed to take action.

The company, which is owned by French firm Vivendi, said it had forged a "strategic partnership" with YouTube last week just before that business was bought by Google. That deal licensed people who posted videos to YouTube to use Universal's music catalogue as a soundtrack.

"UMG broadly embraces the power and creativity of user-generated content, allowing users to incorporate music from UMG's recorded music catalogue into the videos they create and upload onto YouTube," said a Universal statement last week. "UMG and its artists will be compensated not just for UMG produced videos but also for the unique, user created content that incorporates UMG music."

Bolt said it adopts a policy of taking down copyright infringing material when it is notified about it. "There's no question that people upload copyrighted content from time to time and occasionally we receive official notices to remove content and we do," Bolt chief executive and co-founder Aaron Cohen told news agency Reuters. Bolt is attempting to agree a licensing deal with Universal, the agency said.

Sony Pictures agreed to buy Grouper earlier this summer for $65m and Universal's claim reserves the right to add Sony to its suit.

It has been thought till now that "safe harbour" protections would protect video sites which take down copyrighted material once they are informed of it, but Universal's suit could challenge that, potentially setting an explosive precedent if successful.

Copyright © 2006, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

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