"Given that Sharman's (Kazaa) software has been downloaded more than 143 million times, it would be mere cavil to deny that Sharman engages in a significant amount of contact with California residents," Wilson wrote. Also, he said, "many, if not most, music and video copyrights are owned by California-based companies."If the lawsuit does go forward, I wouldn't suspect that Sharman Networks stands much of a chance. They'd probably end up becoming the next Napster. However, there are bigger issues at stake in this case. Napster was very much a US-based company, and Sharman is not. If a California court is able to extend its jurisdiction to a company based in Australia and incorporated in a tiny Pacific Island, the ramifications will be felt far beyond the file sharing community.
Does a California court have the right to let the RIAA and MPAA sue Sharman Networks? If they don't, who does? Australia? Vanuatu? Would a more dangerous precedent be set by allowing the California court to proceed or permitting Sharman Networks to hide behind the legal system of countries where it has a physical presence?