Viacom sues Google's YouTube for alleged copyright infringement, seeks $1 billion in damages

NEW YORK — MTV owner Viacom Inc. sued the popular video-sharing site YouTube and its corporate parent, Google Inc., on Tuesday, seeking more than $1 billion in damages on claims of widespread copyright infringement.

Viacom claims that YouTube has displayed nearly 160,000 unauthorized video clips from its cable networks, which also include Comedy Central, VH1 and Nickelodeon.

The lawsuit, filed in U.S. District Court in New York, marks a sharp escalation of long-simmering tensions between Viacom and YouTube and represents the biggest confrontation to date between a major media company and the hugely popular video-sharing site, which Google bought in November for $1.76 billion.

YouTube's soaring popularity has been a cause of fascination but also fear among the owners of traditional media outlets, who worry that YouTube's displaying of clips from their programs — without compensation — will lure away viewers and ad dollars from cable and broadcast TV.

Viacom is especially at risk because much of its programming is aimed at younger audiences who also are heavy Internet users.

Last month Viacom demanded that YouTube remove more than 100,000 unauthorized clips after several months of talks between the companies broke down.

YouTube said at the time that it would comply with the request and said it cooperates with all copyright holders to remove programming as soon as they're notified.

In a statement, Viacom lashed out at YouTube's business practices, saying it has "built a lucrative business out of exploiting the devotion of fans to others' creative works in order to enrich itself and its corporate parent Google."

Viacom said YouTube's business model, "which is based on building traffic and selling advertising off of unlicensed content, is clearly illegal and is in obvious conflict with copyright laws."

Viacom said YouTube has avoided taking the initiative to curtail copyright infringement on its site, instead shifting the burden and costs of monitoring the video-sharing site for unauthorized clips onto the "victims of its infringement."

A representative for Google didn't immediately respond to a request for comment.

Other media companies have also clashed with YouTube over copyrights, but some, including CBS Corp. and General Electric Co.'s NBC Universal, have reached deals with the video-sharing site to license their material. CBS Corp. used to be part of Viacom but has since split off into a separate company.

Universal Music Group, a unit of France's Vivendi SA, had threatened to sue YouTube, saying it was a hub for pirated music videos, but later reached a licensing deal with the company.

In addition to damages, Viacom is also seeking an injunction prohibiting Google and YouTube from using its clips.

Google shares dropped $4.82, or 1.1 percent, to $449.93 in Tuesday morning trading on the Nasdaq Stock Market, while Viacom's Class B shares rose 43 cents, or 1.1 percent, to $40 on the New York Stock Exchange.