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Monday, February 9, 2004

Piracy hits Web voyeurism
Adam Tanner

THE Internet piracy has devastated the music business, threatened the movie industry and may now undercut one of the most ‘successful’ corners of the Web — pornography.

Perfect 10, a California publisher of a pornographic magazine and Website sued Visa, MasterCard and other financial institutions last week, alleging they facilitated the illegal sale of pirated sex images flooding the Internet.

It based the case on claims other Websites were stealing their sexual imagery to make money, often through duplicitous advertising.

In a complaint filed in the US District Court for Northern California, the firm sued Visa International, First Data Corp., Cardservice International, MasterCard International, Humboldt Bank and Does 1-100.

"The defendants in this case ... are knowingly providing crucial transactional support services for the sale of millions of stolen photos and film clips worth billions of dollars that belong to Perfect 10 and third-parties," the suit reads.

The complaint says these firms have made large sums from the sale of pirated erotica and thus should have a responsibility for any related copyright violation.

"Perfect 10 has concluded that the only way to stop the proliferation of such Websites is to go to the top, namely the payment card associations and the primary third-party processor, each of which is knowingly and effectively acting as fences for the sale of billions of dollars of stolen content," the lawsuit reads.

MasterCard officials did not return calls for comment. A Visa spokesman said he was unable to find company legal experts for their response.

The publisher of Perfect 10, Norman Zada, said in an interview that he had lost $ 29 million since setting up his business in 1996, including $ 8 million on legal fees. He said the problem was that he was spending thousands of dollars for nude photography sessions while many Internet sites were stealing his and other images.

"The reason it was so hard to make money is because while we were paying for our content, there were many Websites out there that were competing against us that were stealing theirs," said Zada whose business is based in Beverly Hills. "It’s pretty impossible to compete in that situation."

The problem of Internet piracy has hit the bottom lines of many businesses, with the recording industry, Hollywood and software businesses the most prominent.