In a scathing ruling issued this week, Grooveshark lost a three-year legal battle for blatantly and consciously infringing on copyrights of nine major record labels.
A federal judge ruled that the two founders of the Gainesville-based music streaming website and its employees violated the copyrights of about 6,000 songs from record labels including Sony Music Entertainment, Warner Bros. Records and Atlantic Recording Corporation.
Grooveshark, which streams virtually any song in the world thanks to uploads from users, came into existence because of a loophole in the Digital Millennium Copyright Act, exempting websites from responsibility for copyrighted content uploaded by users.
The loophole was legal as long as Grooveshark agreed to take down copyrighted material each time record labels formally complained.
But in an attempt to build the website’s momentum in its early days of inception, circa 2006, Grooveshark violated this agreement.
Instead, the two founders, Samuel Tarantino and Joshua Greenberg, started uploading songs personally, avoiding record company approval and licenses.
According to the ruling, the founders acknowledged that their business plan was to exploit the record companies’ content to grow their own business, then “beg forgiveness” and seek licensing agreements.
Tarantino and Greenberg not only uploaded their own content, but also urged employees to do the same.
In a company-wide forum post in 2007, Greenberg told employees to “please share as much music as possible from outside the office, and leave your computers on whenever you can. This initial content is what will get our network started — it’s very important that we all help out!”
The post continued with Greenberg encouraging employees to download as many MP3 files as possible and upload them to Grooveshark’s shared files, building a library of illegal songs to help the company gain traction.
“There is no reason why ANYONE in the company should not be able to do this,” the post said, “and I expect everyone to have this done by Monday… IF I DON’T HAVE AN EMAIL FROM YOU IN MY INBOX BY MONDAY, YOU’RE ON MY OFFICIAL S**T LIST.”
A handful of employees testified to the encouragement, according to court documents.
By 2008, as the company neared the release of its current operating system, Grooveshark Lite, employees were again told to upload content to the site’s Central Music Library to reach the 2-million-song benchmark.
The next year, numerous notifications from record companies started flooding the site, asking for content to be taken down.
If Grooveshark complied with the complaints, users were then free to legally reupload and replace the removed content.
According to the ruling, Grooveshark employees personally uploaded songs again.
A UserFiles table kept by the site contained proof of more than 150,000 Grooveshark employee-uploaded files, including thousands of recordings owned by the record companies in the suit.
Grooveshark also destroyed evidence of Greenberg’s personal uploads, records of 320,000 employee uploads and source code files.
All in all, copies of copyrighted songs belonging to the nine record companies were streamed at least 36 million times.
Users of the service and past and future employees will not be held liable for songs uploaded.
Grooveshark declined to comment on the ruling. Both sides have 18 days to propose damages.
In July, problems within the company were the subject of an anonymous post by a Grooveshark employee on Pastebin, an application that stores plain text. The post cited multiple layoffs and allegations of false reviews.
“It’s bad. Really, really bad,” the post read. “I’m working here until I can find a decent job somewhere else where I won’t have to sell my soul anymore.”
Breana Auberry, president and co-founder of Swamp Records, which announced a partnership with Grooveshark last month, said the ruling won’t affect the student-run record label.
“We aren’t in streaming nor a major record label, so this doesn’t affect us at all,” Auberry said.
“We are a nonprofit, student-run record label that was offered support by some amazing Gator alumni,” she added.
According to Grooveshark’s website, more than 30 million users shared more than 15 million files.
[A version of this story ran on page 1 on 10/2/2014]
Grooveshark’s website can now be streamed on all devices, including tablets, through www.grooveshark.com. The announcement is an expansion of its mobile streaming website.
Adrian Hayes-Santos, of Grooveshark, speaks with students in April 2014 in Weimer Hall. About 10 professionals spoke on the job panel.
