Mediation Begins in Music Copyright Trial

By AUDRA ANG, Associated Press Writer

Four music giants and their local subsidiaries have entered mediation with, China's largest Internet search engine, over the recording companies' claims of copyright infringement.

No agreement was reached after more than five hours of discussions that began Monday at the Beijing No. 1 Intermediate People's Court, the official China Daily newspaper said. A judge would resolve the issue if there is no resolution.

It is the second time this month that Baidu, whose share price went as high as $153.98 after an initial public offering at $27 on the Nasdaq Stock Market in August, was in a Chinese court dealing with accusations of copyright violations. Baidu's U.S. shares were up 22 cents at $77.50 in morning trading Tuesday on the Nasdaq.

Universal, EMI, Warner, Sony BMG and local subsidiaries claim that Baidu made it easy for its users to illegally download copies of 137 of their songs through the search page. The music companies are seeking 1.67 million yuan, or $206,000, in compensation, the China Daily newspaper said.

A man who answered the phone at the court Tuesday said the case was still under mediation but said he was unclear about what progress had made. He refused to give his name.

According to the China Daily, Baidu defended itself by saying that it is simply providing basic search functions, not downloading services. The company also says it advocates improving copyright protection on the Internet and promises to provide protection if a company can prove it owns the rights to a song, the newspaper said.

Baidu's lawyer, Li Decheng of the Zhonglun W&D Law Firm in Beijing, said Tuesday that he could not comment on the case without his client's permission. Cynthia He, a Beijing spokeswoman for Baidu, said the company had no comment.

Baidu's MP3 search page is hugely popular among young, increasingly tech-savvy Chinese. Analysts say it has grown into China's largest search engine, prompting U.S. search giant Google Inc. to buy 2.6 percent of the company last year.

On Sept. 16, the People's Court of Haidian District in Beijing ordered Baidu to pay 68,000 yuan, or about $8,400, to mainland music company Shanghai Busheng Music Culture Media for unauthorized downloads of 46 songs. Baidu is appealing.

Copyright 2005 The Associated Press.

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