Major Label Groups Sue Video Site For Copyright Infringement

One Of The Plaintiffs

The three major label conglomerates -- UNIVERSAL MUSIC GROUP,  SONY MUSIC ENTERTAINMENT and WARNER MUSIC GROUP -- have sued PHILIP MATESANZ, owner of PMD TECHNOLOGIE UG, operator of the site YOUTUBE-MP3.ORG, in a LOS ANGELES federal court for alleged copyright infringement, MARKET WATCH reports. The labels are seeking damages of $150,000 for each infringed-upon song or sound recording.

The defendants couldn't immediately be reached for comment.

The suit alleges that YOUTUBE-MP3.ORG has tens of millions of users and accounts for about 40% of the world's stream-ripping activity. Users are prompted to enter a link to a YOUTUBE video and can click a button to remove any ads and create an audio file. "This site is raking in millions on the backs of artists, songwriters and labels," RIAA Pres. CARY SHERMAN said in a statement.

Record companies have licensing agreements with YOUTUBE that permit it to stream much of their music to users in exchange for a cut of associated advertising revenue. But the agreements don't allow YOUTUBE to offer the permanent, ad-free downloads that stream-ripping sites help users create. They believe that fans who stream-rip have little reason to buy the songs or sign up for subscription music services such as SPOTIFY AB and APPLE MUSIC. Streaming services generated $1.6 billion for record labels in the U.S. alone in the first six months of 2016 -- amounting to about half of their domestic revenue. Record companies' revenues are down 60% from 2000, despite nascent growth in recent years.

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