Record firms lose Net case

WASHINGTON — A federal appeals court Friday ruled that Internet account providers do not have to give record companies the names of computer users who share songs online, dealing a sharp blow to the industry's efforts to crack down on illegal copying of digital music.

The ruling throws out two lower-court decisions that gave the Recording Industry Association of America (RIAA) the right to subpoena the names of thousands of suspected users of file-sharing software programs without first filing lawsuits.

The association sued 382 people and warned 398 others in a widely publicized campaign to scare the estimated 60 million U.S. music swappers, and the parents of those who are teens, into giving up the practice and buying songs instead.

The association settled with 220 defendants — some for thousands of dollars — while 1,054 swappers signed "amnesty letters" vowing to erase their song files and promising never to steal music again.

Consumer advocates and Internet providers hailed Friday's ruling as an affirmation of privacy rights for Internet users in the face of a mass attack by a single industry.

The recording association said it would not be deterred from protecting the business of its members and promised additional lawsuits, saying it would seek the names in a more time-consuming way.

The RIAA claimed that it was entitled to expedited subpoenas issued by court clerks, rather than judges, under a 1998 law designed to protect copyrighted works in the digital age. Although industry sleuths could track down the numerical Internet address of someone using file-sharing software, they could not take legal action without getting names and physical addresses of the swappers from their Internet access providers.

The music industry has suffered at the hands of services such as Kazaa, Morpheus, Grokster and LimeWire, which by some estimates have cost it more than $5 billion a year worldwide.

But the subpoenas were fought by Verizon Communications Inc.'s online division, which provides Internet access for 2.1 million consumers.

The company was forced to begin turning over names in April after a lower-court judge ruled against it.

Verizon argued that the privacy and safety of its customers would be compromised if the subpoenas were not issued by judges, who first review their validity. The company also argued that the Digital Millennium Copyright Act prohibits Internet providers from being held responsible for what moves across their networks.