Just before the closing bell on Friday, Universal filed a copyright infringement lawsuit against Grooveshark’s parent company, Escape Media Group, in New York district court alleging that the company’s employees had illegally uploaded as many as 100,000 songs to the Grooveshark playlist. Though the complaint is not yet available on the court’s website, the allegations bandied about in the press paint a damning picture of the company’s business practices. These new allegations follow hard on the heels of last month’s comments by an anonymous tipster who claimed to be a current Grooveshark employee. According to the tipster: “We are assigned a predetermined amount of weekly uploads to the system and get a small extra bonus if we manage to go above that (not easy). The assignments are assumed as direct order for the top to the bottom, we don’t just volunteer to “enhance” the Grooveshark database … Are the above legal or ethical? Of course not . . . .”
A number of reports quote the complaint as alleging that Grooveshark’s executive officers not only directed the illegal uploading, but participated in the wrongdoing themselves, going so far as to claim that CEO Samuel Tarantino personally uploaded at least 1,791 copyrighted songs to the Grooveshark system, Senior Vice President Paul Geller uploaded 3,453 copyrighted songs to the system, and Vice President Benjamin Westermann-Clark uploaded more than 4,600 illegal tracks. Although, as a general rule, I tend be skeptical about allegations of pervasive wrongdoing in the upper echelons of a company when they are casually bruited about without any accompanying proof, the allegations – if true – do not bode well for Grooveshark’s future. The company has been plagued by similar litigation in the past, which resulted in settlements and licensing agreements with Capitol and Virgin Records (among others), but in recent days the attacks have come with a relentlessness that bodes ill for Grooveshark. Among other setbacks, earlier in the week the anti-piracy group RettighedsAlliancen (renowned for taking on Pirate Bay) exhorted the Danish courts to have the country’s Internet service providers block Grooveshark in Denmark. While Grooveshark has managed to weather such storms in the past, the efforts now being brought to bear against the company may presage its doom.
Stay tuned for further news and updates.
Update 11/23/2011: Click here for a copy of the just-released Universal v. Grooveshark Complaint. Click here to see the Exhibits to the Universal v. Grooveshark Complaint.