Chinese court rules against Yahoo

The U.S. pressure on Beijing to crack down on widespread copying of music, movies and other goods has met with success. A Chinese court ruled against Yahoo Inc.'s China arm in a lawsuit by recording companies over music piracy, a state news agency said Tuesday.

Companies including Warner Music, Sony BMG and Universal Vivendi accused Yahoo China of violating copyrights because of links between its search engine and Web sites with 229 illegally copied songs.

The Beijing No. 2 Intermediate People's Court concluded that Yahoo China infringed copyrights and ordered it to pay 210,000 yuan (US$27,000; EUR20,000) in damages, the Xinhua News Agency said.

Court employees would not say whether such a ruling was issued and referred questions to the Beijing High People's Court. Employees there asked for questions to be submitted by fax and did not immediately respond.

Yahoo China said it would appeal and stressed its respect for intellectual property rights.

"We will appeal this decision because we believe Yahoo! China's music search service both meets and exceeds the relevant legal standards for intellectual property protection," the company said in a statement. "An important principle is at stake in this case _ search engine operators should not be held liable for content posted on third-party Web sites."

Yahoo China is operated by Sunnyvale, California-based Yahoo Inc.'s local partner, Alibaba.com, China's biggest online commerce site.

Yahoo had expressed confidence earlier that it would win the case after a court ruled in favor of a Chinese search engine, Baidu.com Inc., in a similar lawsuit in November.

The International Federation of Phonographic Industries, a trade group that filed both lawsuits on behalf of recording companies, is appealing the Baidu ruling.