Kazaa case goes before U.S. District Federal Court Judge today

A U.S. District Court Judge in Los Angeles will hear arguments today, November 25th, as to whether Kazaa's parent company, Sharman Networks of Australia, can be sued by the recording and film industries of the U.S. and enjoined from providing its very popular online file-swapping music and video services in the U.S.

If the Judge rules that Sharman Networks can be sued in the U.S., Kazaa will likely suffer the same fate as similar online file-sharing companies, Napster, Morpheus, Aimster, Audio Galaxy and Grokster. Sharman Networks is incorporated in Vanuatu, a Pacific island, and has tried to limit its business contacts within the U.S. to help defer its legal liability here. The extent of the "long arm of U.S. law" will face an important test here.

Internet businesses that offer their services in remote overseas locations do not fit the traditional "nexus" case law precedent of 'significant business contacts within the U.S.' However, because the case involves intellectual property ownership and copyright infringement claims, it is being watched closely by lawyers and companies with potential international infringement and piracy claims.