Record Labels Demand $2.56 Million in Damages from File-Sharing Site

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A group of top Hollywood production houses has demanded $2.56 million in damages from the men behind the Swedish file-sharing web site The Pirate Bay, the International Federation of the Phonographic Industry said.

The Pirate Bay, which started in 2004, allows 10 million to 15 million users to share films, music and other copyright-protected material.

A Swedish prosecutor filed charges in January against four men for organizing the web site, saying it has helped millions of users worldwide violate copyrights.

Plaintiffs in the case include Warner Bros. Entertainment Inc., MGM Pictures Inc., Colombia Pictures Industries Inc., 20th Century Fox Films Co., Sony BMG, Universal and EMI.

“The compensation now demanded is based on the albums that the prosecutor included in his charges. The damage to the record labels, artists and originators, caused by The Pirate Bay’s illegal activity is several times bigger,” said the head of IFPI in Sweden, Lars Gustafsson.

Lawyer Peter Danowsky, who represents the record labels, added: “It is extremely difficult to calculate the real damage. Because of this we have chosen to work with a template. How the court finally decides what damages the four will pay is of great interest for similar cases in the future.”

The case stems from a May 2006 crackdown on illegal file-sharing that temporarily shut down the site. The four suspects, three from Sweden and one from Finland, were charged with both accessory and conspiracy to break Swedish copyright law. If convicted, they face a maximum of two years in prison.

Pirate Bay spokesman Peter Sunde, who was among those charged, told the Associated Press he thought the claims suitable for a good April fools joke.

“It is completely unreasonable how they have counted. We should get paid by them. All research in this area shows that they actually profit by file-sharing,” he said, pointing to supposed extra promotion.

Besides Sunde, 29, from Finland, the others facing claims for damages are Fredrik Neij, 29; Gottfrid Svartholm Warg, 23; and Carl Lundstrom, 47.