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Universal Music Hit with Anti-Piracy Suit

New York-based DownloadCard cries foul over UMG's upcoming Bon Jovi CD release, charging it stole its PIN technology for its online promotion.

September 26, 2002
By atnewyork Staff: More stories by this author:

New York promotions/technology company DownloadCard has sued Vivendi Universal's music division, charging theft of its anti-piracy technology, trade secrets and ideas.

The action could hold up the marketing campaign about to kick off in conjunction with rocker Jon Bon Jovi's upcoming release of his latest CD, "Bounce", which involves the use of special Personal Identification Numbers, or PINs that DownloadCard has pioneered in online promotions.

In a lawsuit filed in federal district court in Manhattan, DownloadCard is asking a judge to stop Universal Music Group's plans to market the band's CD release with a unique PIN code attached to the CD. DownloadCard specializes in providing the PIN technology and charges that after retaining DownloadCard in September of last year, it lifted its technology and trade secrets and decided to go it alone with the Bon Jovi promotion.

With UMG's recently-announced "American XS" promotion, purchasers of the CD get a PIN number with the CD which they enter on the band's Web site (http://www.bonjovi.com) in order to receive special cuts, information and other special content in return for paying for the CD.

The technology is seen by many in the record industry as a friendly way to coax listeners away from pirating music in online file swapping sites by dangling extra online content and goodies that only CD purchasers get.

"In the present entertainment marketplace, DownloadCard considers this 'fan-friendly' anti-piracy feature one of its most important advertising and marketing advantages," the suit said.

Over the past year, UMG has used DownloadCard's PIN technology in over a dozen record promotions, the suit explained. UMG has confirmed, the suit continued, that DownloadCard's technology is "protected intellectual property" and that UMG "will not engage in any activity that might violate DownloadCard's intellectual property rights."

DownloadCard contends that with its recent announcement of the use of special PINs with the October 8th release of Bon Jovi's "Bounce," UMG has printed literally millions of copies of "Bounce" materials using DownloadCard's technology without authorization.

"The proprietary DownloadCard Technology is novel, original and unique. It is not in general use in the industry; it is not known to or offered by any other company," the complaint said. The company is seeking in excess of $750,000 in financial damages related to the "Bounce"-related, PIN-regulated suit, in addition to halting the promotion.

A UMG spokesman did not return calls for comment. A DownloadCard spokesman referring press inquiries to a public relations firm, whose spokesman was not available at press time.







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