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January 29, 2003
JASRAC


Japanese Society for Rights of
Authors, Composers and Publishers

MUSIC FILE SHARING SERVICE IS AN INFRINGEMENT OF COPYRIGHT
FURTHER TO THE PROVISIONAL INJUNCTION,
FILE SHARING COMPANY IS HELD RESPONSIBLE


The Tokyo District Court made a judgment today (January 29, 2003) against MMO Japan Ltd. (based in Hachioji-city, Tokyo) and its representative Michihito Matsuda, who administer a file exchange service called “File Rogue,” recognizing that the company holds responsibility for copyright infringement. The “File Rogue” service allows users to exchange music files, such as those contained in compact discs, free of charge on the Internet.

This judgment is an “interim ruling” in the suit filed by JASRAC (Japanese Society for Rights of Authors, Composers and Publishers) on February 28, 2002 against MMO Japan Ltd. to halt the file exchange service and to demand payment of more than 210,000,000 yen for damages. It is to judge whether MMO Japan Ltd. is the main subject of copyright infringement and whether the defendant is held responsible for compensation of damages due to copyright infringement. As a judgment has been made, from hereafter, proceedings will continue regarding the scope of suspension and the amount of damages to be paid.

In the provisional injunction applied by JASRAC in January 2002, the Tokyo District Court has also made a decision against MMO Japan Ltd. on April 11, 2002 not to transmit to users information of musical works administered by JASRAC (hereinafter referred to as “REPERTOIRE”), such as work titles.

[DETAILS OF THE CASE]
From November 1, 2001, MMO Japan Ltd. has introduced a Japanese version of a file exchange service called “File Rogue” on the Internet from November 1, 2001. The service gained much attention as “a service offering free software to enable file exchange” and as “a Japanese version of “Napster”.”Many Internet users converted musical compact discs into files such as MP3 files and used this website. According to research conducted by JASRAC, at least 63,000 works in the REPERTOIRE a month were used in this service.

On January 29, 2001, JASRAC applied for a provisional injunction to the Tokyo District Court seeking to halt the relevant service. The application was made jointly with 19 companies under the Recording Industry Association of Japan, owner of neighboring rights.

On February 28, 2002, a suit was filed and demands were made as follows

•MMO Japan Ltd. shall not make electronic MP3 files created by the reproduction of REPERTOIRE available sending/receiving by “File Rogue,” an electronic file exchange service on the Internet administered by the relevant company.

•MMO Japan Ltd. and its representative, Michihito Matsuda, shall jointly pay 214,330,000 yen for damages up to February 2002 and 39,690,000 yen a month for damages after March 1, 2002.

Provisional injunction on April 9, 2002YInformation of files, such as work titles and artistsē names, shall not be transmitted to users of “File Rogue.”

On April 16, 2002, MMO Japan Ltd. stopped the “File Rogue” service.

[CONTENTS OF THE RULING]
Recognition of infringement and responsibility

The “File Rogue” service has the characteristics of a service enabling users to make MP3 files available for transmission. The files are automatically transmitted to the public and made transmittable under the administration of MMO Japan Ltd., and from this, the company gains business profit. Therefore, MMO Japan Ltd. is the main subject of the infringement of automatic public transmission rights and the right of making transmittable.

MMO Japan Ltd. and Michihito Matsuda, together acting illegally to infringe copyright, bear the joint liability for the compensation of damages.

[EVALUATION OF RULING AND JASRACēS FUTURE COURSE OF ACTION]
Further to the provisional injunction of April 2002, we would like to highly evaluate the fact that an accurate legal decision was made in this suit by the speedy proceedings. Today’s ruling agrees with the request for the international harmonization of copyright protection, and it also has a big meaning for copyright protection in the IT age and the promotion of appropriate usage of copyrighted works. JASRAC will severely fight not only P2P services but also other illegal usages of copyrighted works by using its original surveillance system and the “Law on Limitation of Certain Telecommunication Service Providers’ Liability to Pay Damages and on Disclosure of Sendersē Information,” and will also continue its efforts to promote appropriate usage of music by methods such as the spreading of digital watermark technology and the building of systems for easier application of copyright clearance.

End