Lawyers: Grooveshark May Have Just Defeated UMG

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It’s a tiny footnote that could save Grooveshark from a ‘legal jihad’.

And, one that could finally give Grooveshark the legitimacy it needs to draw more funding, repair its relationships with Apple and Google, and truly rival Spotify.

And, according to legal sources, an opinion that may already be pushing Universal Music Group towards an embarrassing defeat.

The game-changer is actually buried in this week’s decision in Capitol Records vs. MP3tunes, a ruling that fell solidly in favor of the DMCA and cloud-based lockers.  MP3tunes founder Michael Robertson is soaking up this victory lap (despite being hit with liabilities), but music industry lawyers are also looking at this footnote with great interest:

“This Court agrees with Defendants that the plain meaning of the statutory language makes the DMCA safe harbors applicable to both state and federal copyright claims. Thus, the DMCA applies to sound recordings fixed prior to February 15, 1972.”

Which is funny, because Universal Music Group is suing Grooveshark in New York state court on exactly this issue.  Namely, whether Grooveshark is violating DMCA statutes for pre-1972 recordings, viewed by the legal community as a clever (or evil) tactic to win a decision and drain Grooveshark’s resources.

If that sounds like a frivolous abuse of the legal system to you, then you’re not alone.  “It seems that [Judge William H. Pauley] wrote this for the benefit of the State Court,” one music industry attorney told Digital Music News.  “It’s right on point against Universal.”

Others were surprised by the mention, though another lawyer with extensive copyright expertise pointed to some tension between federal and state court systems.  “[Federal judges] don’t like it when copyright matters are raised on the state level,” the second attorney shared.  “They feel it’s their domain.”

All of which sounds like bad news for UMG.  Then again, Universal is a large corporation, and sources continue to point Digital Music News to a very determined legal attack.  In fact, this has been billed a ‘legal jihad’ for months.  “First off, there’s going to be an appeal of the MP3tunes case,” one label source shared.  “Then, I can speak with certainty that UMG is interested in fighting this one to the finish.”

Stay tuned.