Judge Delays MP3.com, Universal Ruling

A federal judge granted a motion to MP3.com and Universal
Music Group to delay his decision on damage awards to Universal
and parent company Seagram Co. until Tuesday.

Judge Jed S. Rakoff of the US District Court for the Southern
District of New York today was scheduled to award damages in the
lawsuit Universal brought against Seagram.

A spokesperson for Rakoff and an MP3.com spokesperson said that the
case will resume Tuesday morning at 11 a.m.

Rakoff said in his ruling against MP3.com that it may have to
pay $25,000 in damages for each compact disc that MP3.com allegedly
copied for use on its My.MP3.com service. Universal had claimed
that MP3.com illegally copied about 10,000 CDs, seeking a
damage amount of some $250 million, but MP3.com admitted culpability
for only 4,700 CDs, arguing that the damages paid should be even
less.

Universal officials were not immediately available for comment.

Rakoff also noted in his original ruling that MP3.com's damages
should be somewhat mitigated by the fact that although the company
continued to violate copyrights well into June, it acted
"responsibly" for the duration of the trial.

He added that he saw that MP3.com has placed $170 million in a legal
kitty, and noted that if he awards damages of $25,000 for each of the
4,700 CDs, MP3.com would be responsible for paying out $117.5
million, plus other costs.

MP3 already has settled lawsuits with four of the other major
music companies, and has arranged licensing deals that come in at
about $20 million each.

The company has said it plans to appeal the finding that it
willfully infringed on copyrights, though Rakoff noted in his
conclusions of law that the company at all levels - from
executive to engineering - was well aware of the possibility of
illegality, and sought counsel from its law firm on all legal
questions. The company invoked attorney-client privilege, however,
so it is unknown what MP3.com received in the way of legal
advice.

MP3.com also said that it would appeal any dollar amount ruling that
it considered too high.