Universal Music Group, the parent company of Island Def Jam, filed a lawsuit against MySpace.com's corporate parent News Corp. on Friday (Nov. 17), claiming the popular Internet site is guilty of copyright infringement.
UMG, the world's largest label, filed the lawsuit in U.S. District Court for California's Central District, after Jay-Z's highly anticipated come back album Kingdom Come was leaked on MySpace.com.
The entire album hit the Internet last week and has been traded en masse across the Internet and heavily bootlegged around the country.
"I'm sure it's cut into our sales, and not by a small amount," Antonio' "LA" Reid told The Wall Street Journal. "Even if it [sells] a million units it's not what it should have been."
UMG and MySpace had been negotiating a deal that called for News Corp. to pay a licensing fee for Universal content.
The deal stalled when UMG requested that News Corp. also pay restitution for content that had previously appeared on MySpace.
MySpace is in the process of testing digital rights management software to report and remove files that infringe on an owners copyright.
"Notwithstanding MySpace's frank admission that it is 'unable,' i.e., prohibited by law, from offering its music and video services without first obtaining the permission of the copyright owner, MySpace has knowing and intentionally operated its business on the fiction that it has obtained the licenses it needs to exist from members that MySpace well knows are not the true copyright owners," the suit stated.
UMG seeks $150,000 in damages for each 58 songs and videos MySpace allegedly infringed upon.
MySpace.com representatives were confident that they would "prevail in court."