Kazaa Owners Face Asset Freeze

by Mary Swire, for LawAndTax-News.com, Hong Kong

08 March 2005

The Australian music industry on Friday called for the assets of Kazaa's parent company, Sharman Networks, to be frozen.

Sharman and its principals are facing a lawsuit brought by the Music Industry Piracy Investigations (MIPI) body, which seeks to hold the peer-to-peer file sharing service responsible for the copyright infringing uses to which it is put.

Speaking on behalf of the music industry in the Federal Court of Australia on Friday, MIPI lawyer Tony Bannon asked that Kazaa's owners be forced to disclose their assets and restrained from selling or transferring them, following CEO, Nikki Hemming's recent sale of her house to the firm's accountant.

However, the Associated Press revealed that MIPI had only been partially successful in its effort to lock down the finances of Sharman and its top executives, with the court refusing to force a disclosure of assets.

The firm's lawyer, Mary Still announced that contrary to some reports, the company and its directors had agreed not to dispose of assets beyond their daily expenditures, but were under "no legal obligation" to disclose them.

"That only comes about once they (the recording companies) have won these proceedings," she was quoted by the AP as explaining, going on to add that: "The record industry has never won this argument anywhere in the world."

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