Sharman asset freeze story -
p2pnet.net News View:- The Earth is flat, the moon landing never happened, the world will end next week and Ashlee Simpson is one of the great recording artists of her generation.
It’s funny how misinformation can enter the market place and get reported as the truth.
It’s also funny how the misinformation gets reported so widely.
As we know by now, on March 4, 2005 the Australian Federal Court refused to grant a request by ARIA to force the alleged owners of the Kazaa Media Desktop to disclose their assets, and not to dispose of their assets pending a decision in the Kazaa case.
We also know that at least one well respected publication incorrectly reported the injunction had been granted.
Innocent mistake, or another shot fired in the PR war?
You decide.
The ARIA had sought Mareva orders in order to “restrain … the respondents from dealing with assets under their control so as to dissipate or remove them from the applicants’ reach and thereby frustrate a potential judgment in the applicants’ favour”. ARIA also requested that the respondents be ordered to file an affidavit of assets detailing their possessions as at last Friday.
So what actually happened on March 4, 2005?
Counsel for the respondents including Nikki Hemming and Kevin Bermeister asked for an adjournment of the request for an affidavit of assets, saying it would “interrupt” them because they’re currently preparing a written response to the submissions prepared and lodged by the applicants in preparation of the closing statements of the case.
Justice Margaret Stone, the sitting judge on the day, contacted Justice Murray Wilcox who’s heard all of the Kazaa case to date. Justice Stone allowed the adjournment following an assurance from Justice Wilcox that he’ll hear the applicants’ request on March 22, 2005 – prior to closing statements.
What was the point of the application of these Mareva orders?
A Mareva order is granted under Australian law for the administration of justice. It takes the form of a negative interlocutory injunction. Typical Mareva orders include orders for the respondent to preserve assets and not to leave the jurisdiction. They’re usually granted to an applicant who’s successfully obtained a judgement against the respondent, but before there has been an order for damages.
So, has there been a judgement in the Kazaa case? No. We haven’t even heard final submissions yet, so it seems as though ARIA’s application was premature.
Yet was it premature? No – not if the purpose of the application was to distract the respondents while they are preparing their final submissions.
There are only a finite number of lawyers working for the respondents who are involved in this case, and if they’re working on a response to a Mareva order application then they’re not working on final submissions.
Great litigation tactic – force your opponent to take their eyes off the ball! This Mareva tactic also suggests the ARIA is very confident it’ll win its case … or it would like the world to think it’s very confident. The ARIA is so confident about victory that it’s not even waiting for the victory before it applies for a Mareva order!
Such an expression of confidence is very risky – given that we’re probably at leat two months from a decision and no one can read Justice Wilcox’s mind.
The instigation of all of this fuss was the Altnet press release entitled “Altnet Launches First-Ever Advertising Fund Dedicated to Sharing P2P Revenue.”
The press release announced “the first-ever online advertising revenue-sharing fund to be split with top independent labels. Among its numerous significant independent label customers, V2, Artemis, Epitaph/Anti, Side One Dummy and Palm, Simmons/Latham, and Koch Media will participate in this fund where they will share the revenue generated from advertising that appears in the user interface of popular Peer to Peer applications.”
The ARIA effectively claimed Altnet was going to spend their money now by distributing it to other companies – and wanted the court to prevent them from doing so. All of this was very surprising. The amounts of money are very small – we’re talking thousands of dollars but not hundreds of thousands of dollars. Also, on March 1, 2005, three days before the Mareva, hearing the following report appeared in one of Australia’s most respected music industry columns:
“LABELS TAKE P2P CASH … Australia’s peak record industry body, ARIA, is currently suing Altnet for copyright infringement – but won’t kick out or discipline members of ARIA who take the company’s tainted cash. ‘This has nothing to do with the Kazaa case locally, which is about the unlicensed distribution of sound recordings and the liability for that activity,’ an ARIA spokesperson says. ‘Any arrangements which may exist between copyright owners and Altnet in relation to the licensed distribution of recordings is entirely a matter between those parties – it has no relevance to, or connection with, the liability for the unlicensed distribution of recordings via peer to peer networks which is the subject of the local proceedings in relation to the Kazaa network’.” See
So – when did the change in position by ARIA take place, and why didn’t anyone tell the ARIA PR rep? You know that old cliché about the left and right hand? That’s the problem with litigation stunts – they can backfire and sometimes you forget to tell your own people you are doing them. Can’t wait for the next one …
BTW Ashlee if you are reading this – I love you, please come home, I forgive you. Or is this more misinformation?
Malik is in the final stages of a PHD in Law with a specialisation in intellectual property rights enforcement at the University Of Technology, Sydney. He’s also an ex-ARIA in-house lawyer and former senior legal officer at the Australian Communications Authority, Canberra.
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March 7th, 2005 at 12:56 am
It seems every step and tactic by big music in Australia has been thought through very carefully. Right down to “innocent” media mistakes. So where’s the correction by the esteemed media publication that made the error? I’ll bet the retraction doesn’t get the same publicity as the refrain “Kazaa Assets Frozen”. It’s a shame – big music in Oz is winning the PR battle and winning it very well. They can even lie and get away wit it. Why did it take 3 days for the truth to come out? Hopefully stunts like this won’t distract the judge.
March 7th, 2005 at 1:10 am
Murray knows which way is up
March 7th, 2005 at 7:08 am
Gee, innocent mistake, you can’t trust them, the people who say the assets aren’t frozen that is. Bet we don’t see anyone correcting this little innocent mistake!
March 7th, 2005 at 7:09 am
Who goes to court to agree to their assets being frozen and then calls it a victory because they did what the record companies wanted???? Kazaa does!!
Why would you agree to having your assets frozen if you were in the clear?
March 7th, 2005 at 3:58 pm
you agree to it because you don’t believe you need top hide your assets cause your gonna win.
March 7th, 2005 at 4:11 pm
Obviously written by someone who can type but cannot read. Kazaa didn’t agree to anything because the motion to freeze assets was DENIED. How can you freeze the assets before you even win your case? Go to the bathroom, sit on the toilet and think about it for a while. Jeez, what a gullible gus.