Napster Timeline
May 1999
Shawn Fanning, a freshman at Northeastern University in Boston, Massachusetts, founds the Napster online music service. The service, known as peer-to-peer file sharing, allows users easily to trade music encoded in the MP3 format, which compresses recordings into small and portable files without sacrificing quality. Fanning wrote the original program after he and his friends were frustrated in their search to find MP3s on the Internet. Napster was named the fastest growing home software application in history by Media Metrix, an Internet research company. Napster now says it has 58 million registered users, which is more than double the 20 million users the company claimed in July 2000.
December 1999
Multiple record labels file a lawsuit against Napster, accusing the company of encouraging the illegal copying and distribution of copyright music on a massive scale. Some of the most powerful recording companies joined in the lawsuit, including Seagram Co. Ltd.'s Universal Music, Bertelsmann AG's BMG, Sony Corp.'s Sony Music and AOL Time Warner Inc.'s Warner Music Group and EMI Group Plc. AOL Time Warner is the parent company of CNN.
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July 26, 2000
U.S. District Judge Marilyn Hall Patel issues an injunction against Napster, ordering the company to prohibit copyrighted songs from appearing on its online file-sharing service, a move that would essentially shut the service down, while the main arguments about the recording industry's lawsuit progressed through the court system. Traffic at Napster's Web site increased 71 percent the next day as users scrambled to download from the company's archive before they thought it would be shut down.
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July 28, 2000
Napster appeals Patel's ruling to the 9th U.S. Circuit Court of Appeals, which stays the order, allowing Napster to continue operations until the case goes to trial.
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October 2, 2000
The record labels appeal to the 9th U.S. Circuit Court of Appeals in San Francisco, California, to re-instate the injunction. The court hears arguments in October, with the record labels asking the appellate court justices to reimpose the lower court ban prohibiting Napster from allowing copyrighted songs to appear on its Web site, a move that would essentially shut the service down. Napster opposes the move, saying it is simply a song-swapping service that has run afoul of recording industry attempts to maintain a "chokehold" on music distribution.
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October 31, 2000
One of the record companies involved in the Napster lawsuit, Bertelsmann AG, announces that it is forming a partnership with Napster to develop a fee-based music downloading service. Once the service is implemented, Bertelsmann will drop out of the Recording Industry Association of America lawsuit.
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January 29, 2001
Bertelsmann announces that Napster will introduce a membership fee for users in summer 2001.
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February 12, 2001
The 9th U.S. Circuit Court of Appeals rules that Napster knew its users were violating copyright laws through its music file-sharing service, but the court allows the company to continue to operate until U.S. District Judge Marilyn Hall Patel can re-draft her injunction. The three-judge panel specifically cited a memo drafted by Napster's co-founder Sean Parker as evidence the Web site knew its users were violating copyright laws. In that memo, the court said, Parker said the company needed to remain ignorant about the "real names" of the users because "they are exchanging pirated music." For that reason, the court found that Napster was involved in "contributory and vicarious infringement" and had full knowledge that it was allowing its users to infringe upon copyright laws.
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