updated 08:30 pm EDT, Thu March 29, 2012
Retains right to refile down road
Megaupload has dropped its lawsuit against Universal Music Group for allegedly illegally getting YouTube to pull its "Mega Song" video off of the video sharing site. The company said it decided to focus its legal resources on defending itself against criminal charges for copyright violations. Company lawyers insist they will retain the right to reinstate the lawsuit in the future if appropriate.
The case began in December after Megaupload, which had been under attack for its practice of hosting musical content that might have been illegally uploaded and shared, posted the video "Mega Song" on YouTube. The video was a compilation of supportive musical soundbites from media performers including P Diddy, Alicia Keys, Kanye West, Snoop Dogg, and Mary J Blige. The song reached over 100,000 viewers, but UMG took it down on its own. Megaupload filed suit claiming that UMG didn't have any actual rights to the content, and therefore had acted illegally.
UMG contended that the music distribution company had a private agreement with YouTube whereby it could ask for any content to be removed, regardless of who actually owned it. YouTube denied this and implied that the music label had abused what access it had.
Magaupload has been under fire allegedly violating US and international piracy laws. In January, its operations were shut down by federal prosecutors. Its founder, Kim Dotcom, was arrested in New Zealand and is awaiting extradition to the US. Earlier this week, entertainment company ValCom, also claiming copyright infringement, filed its own suit against the Megaupload.
Although Megaupload's lawyers contend that its main reason for dropping its case was so that attorneys could put their full efforts into the criminal charges against the company and its employees, it also may be due in part to a perceived weak case. The site was denied an evidence exploration measure that it thought might get evidence of a wrongful takedown. [via TorrentFreak]