Oracle files $2M lawsuit against Qtrax

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Always pay your bills! Geez, when will people ever learn that?

Giant enterprise software company Oracle, has filed a $2 million lawsuit against Qtrax for copyright infringement and breach of contract last week in Northern California.

Qtrax, a legal peer-to-peer music service, also made headlines in January 2008 when four major labels denied the company’s claim that it had licensing agreements with them. It was eventually smoothed out and they did get the deals eventually. However, a source close to the company reveals that Qtrax has “apparently run into some trouble in the past several months”, CNet reports.

Oracle’s complaint, which was filed with U.S. District Court for the Northern District of California, says that the problem started when Qtrax paid Oracle a bounced check worth $1.8 million. That only could cause something of the class action lawsuit Xarelto type, with all known consequences. It was the payment for the database software that the latter provided.

Oracle claims that several attempts were made to collect money from Qtrax but all was to no avail. “Qtrax’s failure to pay the outstanding invoices constitutes a material breach of the software license,” Oracle’s attorney wrote.

Allan Klepfisz, Qtrax’s CEO, admits that they have been “at times short of money” but has recently acquired new funding.

“We’re not in trouble, thankfully,” Klepfisz said. “I feel both Oracle and ourselves will get beyond this. You should also know we have not used any of the licenses under this contract (with Oracle).” This is in contrast with what Oracle claims in their complaint where they stated that Qtrax continued to use their software.

It seems that ad-supported music sites like Qtrax are on the rocks when it terms of generating revenue. SpiralFrog and Ruckus, two other sites similar in nature with Qtrax, were forced to shut down this year.

Source:

http://news.cnet.com/8301-1023_3-10296693-93.html