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Students to Pay in RIAA Song-Swapping Suit

Four college students have agreed to pay damages ranging from $12,000 and $17,500 each in order to settle lawsuits brought by the recording industry against operators of what it called "Napster-like internal campus networks" that aid in the theft of copyrighted songs.

The settlement, announced Thursday, was in connection with lawsuits filed in early April by the Recording Industry Association of America against the students.

The student operators charged were Daniel Peng of Princeton University, Joseph Nievelt at Michigan Technological University and Jesse Jordan and Aaron Sherman from Rensselaer Polytechnic Institute, which is based in Troy, New York.

The actions were part of the RIAA's campaign to seek the cooperation of college administrators and system administrators to eliminate peer-to-peer file-sharing networks from campuses.

One of the four students, 18-year-old Peng of Princeton, is expected to pay $15,000 to the recording companies over a period of years, without admission of guilt, according to Drinker Biddle attorney Howard Ende, who represented the student in the settlement.

In addition, Peng has agreed "not to knowingly infringe by use of the Internet the record companies' copyrighted works, except under certain specified circumstances," and will shut down his file-sharing site called Wake.com.

Peng's file-sharing Web site, Wake.com, was billed as a search engine that helped students and faculties access and share information offered by members of the Princeton University community, will be shut down, as will other, similar sites operated by the defendants, according to a settlement announcement.

"I don't believe that I did anything wrong," Peng said in a statement. "I am glad that the case has been settled amicably, and I hope that for the sake of artists, the larger issues can soon be resolved."

Nievelt, of Michigan Tech, is also expected to pay $15,000 to the recording companies in payments spread out over a few years. The other two defendants, Jordan and Sherman of RPKI, are expected to pay $12,000 and $17,500 each, also in payments spread out over a few years.

The RIAA alleged that the students also shared thousands of copyrighted-protected songs on software known variously as Flatlan, Phynd or Direct Connect. "All of them work much like Napster, centrally indexing and processing search requests for copyrighted works. And they permit users to download any of those works with the single click of a mouse," the trade group said.

Having already issued a warning about file-swapping at workplaces, the RIAA is expected to turn to battling file-swappers who use the high-speed networks of Fortune 500 companies.

"More of these lawsuits are coming. The RIAA wants to show it isn't bluffing about going after specific individuals to send a message to the world at large," a legal source with knowledge of the RIAA's plans told internetnews.com in early April.

Outgoing RIAA chief executive Hilary Rosen has already testified in Congress about the "growing epidemic" of file-sharing within campus networks, warning that a "substantial portion" of the 2.6 billion files that are downloaded illegally every month comes from college computer systems.

Melissa Klipp, an intellectual property attorney with Drinker Biddle, which represented Peng, said in a statement: "While we understand the recording industry's dilemma, we do not believe that heavy-handed litigation against 18- year-old college students is the proper way to resolve the RIAA's problems."

She said the technology at issue is available universally through operating systems purchased throughout the country and the world. "As reflected in the MGM v. Grokster opinion issued from the Central District of California last week, American courts are viewing these situations more realistically."

Last week, a federal court in California ruled that two popular P2P networks, Grokster and Morpheus, could not be held liable for piracy by third-party users.

The judgment frees the networks from being sued by a slew of big-name media companies, including AOL Time Warner, Vivendi Universal, Sony Corp., Viacom Inc., News Corp. and Walt Disney Co.

But the day before that ruling, a federal judge also ruled that Verizon must reveal the names of two Internet customers the RIAA claims have illegally downloaded hundreds of copyrighted songs from the Web. The case is under appeal.