RIAA Joins Congressional Caucus in Unveiling First-Ever List of Notorious Illegal Sites

Baidu, Pirate Bay At Top of List

WASHINGTON - May 19, 2010 - Recording Industry Association of America (RIAA) Chairman & CEO Mitch Bainwol today joined Congressional members of the International Anti-Piracy Caucus (IAPC) to unveil a list of countries with inadequate intellectual property protections, and, for the first time ever, six illegal websites overwhelmingly used for the global exchange of illegal movies, music and other copyrighted works.  

At a morning Capitol Hill news conference, IAPC Co-Chairmen Senators Sheldon Whitehouse (D-RI) and Orrin Hatch (R-Utah) and Congressmen Adam Schiff (D-Cal.) and Bob Goodlatte (R-Va.) named China, Russia, Mexico, Canada and Spain as “Top Priority Countries” with lax intellectual property enforcement.  China’s Baidu, Canada’s IsoHunt, Ukraine’s mp3fiesta, Germany’s RapidShare, Luxembourg’s RMX4U.com and Sweden’s The Pirate Bay were identified as the priority sites.

These websites and services are primarily used for the illegal exchange of copyrighted works, undercutting the ability of legitimate services to compete and thrive in the global marketplace, and displacing thousands of jobs that rely on the global protection of copyright.  One study commissioned by the International Intellectual Property Alliance (IIPA) concluded that more than 11 million workers are employed by copyright-related industries in the United States.

The release of this report casts a damning spotlight once again on several nations with lax copyright protections and websites that brazenly traffic in copyright theft,” said Mitch Bainwol, Chairman and CEO, RIAA. “I’m particularly struck by the IAPC decision to identify significant global websites that facilitate massive theft; theft that destroys jobs and cuts short the dreams of creators who find it more difficult to attract the capital they need to build their careers.

Just last week, five years after the 9-0 Supreme Court landmark decision against Grokster, we saw a federal judge rule against the most significant theft machine in this country – LimeWire.  While it took some time for the judicial process to work, we did see that in a nation of laws, those who set up elegant schemes to profit from theft will be stopped.   There is basic accountability, although much work needs to be done to achieve a fully accountable Internet space.

The global challenge in the years to come will be to win the battle for a civilized Internet that respects property, privacy and security.   An Internet of chaos may meet a utopian vision but surely undermines the societal values of safe and secure families and job and revenue-creating commerce. Shining the spotlight on these websites sends a vital message to users, advertisers, payment processors and governments around the world.

We congratulate the work of the IAPC and in particular its co-chairs, Senators Whitehouse and Hatch, and Congressmen Schiff and Goodlatte, for their leadership and invaluable hard work.”

In some respects, one particular site, Baidu, might be the most egregious site named today.  The Chinese company is publicly-traded and its search engine is one of the most popular features, providing quick and prioritized links to illegal free copies of pre-release or current-release music.  Various estimates suggest Baidu is responsible for distributing around 50 percent of the unauthorized online music content in China.  Baidu’s own disclosures to the Securities and Exchange Commission (SEC) reflect its knowledge that its dedicated music service is dependent upon providing links to illegal content.  As one disclosure stated:

“A significant portion of our traffic is generated by users of our MP3 search service. According to         Alexa.com, 16% of our traffic went to mp3.baidu.com, our MP3 search platform, as of March 31, 2006. Should we face (as a result of the foregoing considerations or otherwise) a need or decision to substantially modify, limit, or terminate our MP3 search service, our business, financial condition or results of operations could be materially and adversely affected.”

The other websites also certainly earned the dubious distinction of being identified, and reflect the evolving nature of global copyright theft.  The Pirate Bay advertises its intent in its name, and remains operational notwithstanding the criminal judgment against it in Sweden. Ukraine’s MP3fiesta maintains an unlicensed pay-per-download site in the style of the now shuttered allofmp3.com; the site stores and charges for content and claims licenses from societies that clearly lack authority to grant them.  And Rmx4u.com, Canada’s isoHunt and RapidShare are all leading sources of illegal music and operate with the clear purpose of encouraging and inducing theft.

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The Recording Industry Association of America (RIAA) is the trade organization that supports and promotes the creative and financial vitality of the major music companies. Its members are the music labels that comprise the most vibrant record industry in the world. RIAA® members create, manufacture and/or distribute approximately 85% of all legitimate recorded music produced and sold in the United States.

In support of this mission, the RIAA works to protect the intellectual property and First Amendment rights of artists and music labels; conduct consumer, industry and technical research; and monitor and review state and federal laws, regulations and policies. The RIAA® also certifies Gold®, Platinum®, Multi- Platinum™ and Diamond sales awards as well as Los Premios De Oro y Platino™, an award celebrating Latin music sales.