Facing copyright infringement charges filed by the Australian unit of the Recording Industry Association of America, Philip Morle, Sharman's CTO, told the court that his company was unable to block child porn from being traded over the Kazaa network, and therefore could not possibly control the trading of pirated movie and music files.
Morle's testimony is part of a trial that began in late November and involves a substantial list of plaintiffs, including members of the RIAA, Festival Mushroom and 25 additional companies and individuals.
Sharman Networks is named in the suit along with associated parties Brilliant Digital Entertainment, Altnet and Sharman's CEO Nikki Hemming as defendants.
Morle's admittance comes in response to allegations that Kazaa represents the "world's largest music piracy network" that enables the distribution of child pornography and other illegally traded materials.
Sharman Networks has been under fire for the past two years because of its alleged involvement in providing a popular and widely used distribution outlet for pirated materials, in addition to its involvement in the file-trading of child porn.
Response to Morle's admittance was less than sympathetic. Attorney's representing members of the RIAA had hoped to use Kazaa's policy on child pornography to prove that the file-sharing network can ultimately control certain content that is exchanged over its network.
"If at any time Kazaa finds that you are using Kazaa to collect or distribute child pornography or other obscene material, Sharman reserves the right to permanently bar you and your computers from accessing Kazaa and other Kazaa services," Sharman policy states.
However, Morle claimed that the actual policy had never been enforced and had only been discussed in person and on paper with Sharman's CEO Nikki Hemming.
In November 2003, U.S. Sen. Lindsay Graham sent a letter calling on P2Ps to obey copyright laws and cease the distribution of pornography, especially child pornography, over P2P networks. The Graham letter was co-signed by Republican and Democrat Senators Dianne Feinstein, Barbara Boxer, Gordon Smith, Dick Durbin, and John Cornyn.
In response to mounting pressure to control piracy and the distribution of child porn over file-sharing networks, trade group P2P United was formed with the intention of developing a code of conduct for file-sharing networks. However, Kazaa did not join as a member of the coalition, which consists of executives from Grokster, Morpheus, Bearshare, Blubster, eDonkey2000, LimeWire, and Streamcast Networks.
In January 2003, gay adult content provider Titan Media sent a scathing letter to the United States Senate accusing Kazaa of doing little, if nothing, to control the amount of freely traded pornography files that end up in the hands of underage users.
At the time, Titan pressed the point that Kazaa has always had the means and the ability to "track, monitor and report on almost every single file transferred within their network," and therefore the company has little reason not to take more control of traded content.
Earlier this month, Kazaa topped a list of “worst spyware threats” put out by Computer Associates International Inc.