Gradually, the recording industry has come to terms with a practice it once denounced as a threat. And now a federal appeals court has given the process a legal stamp of approval.
In a 3-0 ruling Tuesday, the 9th U.S. Circuit Court of Appeals said a 1992 federal music piracy law does not prohibit a palm-sized device that can download high-quality digital music files from the Internet that users can play them at home.
The court upheld a federal judge's refusal last fall to issue an injunction sought by the Recording Industry Association of America. After losing the earlier ruling, the industry has sought to develop a version of the device that would prevent illicit copying.
"We filed this lawsuit because unchecked piracy on the Internet threatens the development of a legitimate marketplace for on-line music, a marketplace that consumers want," the association said in a statement. "Fortunately, the shared interest in such a marketplace has overtaken the lawsuit."
The decision came as supporters of MP3, the software that compresses and stores digital versions of CD recordings, gathered in San Diego for a summit on the legal and business issues influencing online music distribution.
MP3 enables computer users to convert a music track from a CD into a digital file that can be played on their computer or posted on a Web site, where millions of people can download the file.
The case involved the Rio portable MP3 player, made by Diamond Multimedia Systems of San Jose. The device, which sells for about $120, plugs into a computer and rapidly downloads digital music files found online, producing near-CD-quality music.
The recording industry contended the Rio was made for the illegal pirating of copyright music and could drain away billions of dollars in royalties from artists and publishers.
U.S. District Judge Audrey Collins of Los Angeles denied an injunction last fall that would have prohibited distribution.
In upholding her ruling, the appeals court said the Audio Home Recording Act of 1992 prohibits only devices that make copies from digital music recordings. The court said the Rio makes its copies from computers, not digital music recordings.