Michael Robertson (businessman)
||This article's lead section may not adequately summarize key points of its contents. (December 2012)|
Michael Robertson at the 2006 O'Reilly Emerging Telephony Conference.
|Born||1967 (age 45–46)
United States of America
|Residence||San Diego, California|
|Alma mater||University of California, San Diego|
|Known for||MP3.com, Linspire, SIPphone|
Michael Robertson (born 1967) is the founder and former CEO of MP3.com, which quickly became one of the most popular Internet music sites. In the years following his departure from MP3.com, Robertson launched several small start-up companies, including Linspire, SIPphone, MP3tunes, and Ajax 13. He recently founded DAR.fm, a website for recording audio from the radio.
Robertson was the founder of the original MP3.com. Despite the early success of MP3.com on Wall Street (the day of the stock IPO (ticker:MPPP), the stock rose from $28 to peak at $103), Robertson quickly led his company into a firestorm of lawsuits generated by the major record labels and music publishing concerns. The litigation sprang from Robertson's "Beam-it" program, a functionality that allowed people to quickly load their existing CD collection into online lockers at my.mp3.com and access their private music collections online from anywhere in the world. And also "Instant Listening" which allowed instant access of CDs purchased online from participating retailers. However, to launch the service Robertson essentially had to duplicate every music CD ever created. Although MP3.com purchased the CDs for their index and users had to supply their own copy as well, MP3.com violated copyright laws by failing to acquire licenses for the music that was internally duplicated by digitally storing the material on their servers.
Massive lawsuits erupted, with MP3.com claiming fair use and record labels claiming copyright infringement. Virtually every major record label sued MP3.com with MP3 settling the majority of the lawsuits for tens of millions of dollars. Universal Music, however, held out and took the issue to court. After the trial started, in the landmark case of UMG v. MP3.com, MP3.com was found to have violated copyright laws. MP3.com paid $53.4 million to settle Universal Music's claim. This legal outcome triggered a class action complaint charging MP3.com and certain of its officers, including Robertson, and directors with violations of the Securities Exchange Act of 1934. The complaint was boilerplate class action language but revolved entirely around the copyright lawsuit and subsequent stock price decline.
The action was ultimately resolved under the terms of an agreement whereby the defendants, while continuing to deny all liability, paid into an escrow account $35,000,000 and agreed to issue 2.5 million shares of MP3.com common stock which MP3.com valued at the time at $5,391,000, in exchange for complete dismissals and releases of all claims with prejudice. In addition, under the Stipulations, MP3.com agreed to institute certain corporate governance enhancements.
Robertson believed that MP3.com received unfair treatment by being lumped in with the Napster copyright case which took place during the same period. Robertson further speculated that a different outcome was likely if the case had been tried in a court within the 9th Circuit (a federal appellate court that serves the West Coast) instead of a court within the 2nd Circuit (a federal appellate court that serves portions of the East Coast). Others, however, saw the case as simple copyright infringement on a grand, even record-breaking scale. The first line of the Court's opinion reads: "The complex marvels of cyberspatial communication may create difficult legal issues; but not in this case. Defendant's infringement of plaintiff's copyrights is clear," rendering such speculations moot.
MP3.com was acquired for $385 million by Vivendi Universal during a buying spree by Vivendi's CEO Jean-Marie Messier. After the purchase by Vivendi, Michael Robertson cashed in with an estimated $103 million. In hindsight, after Messier departed Vivendi, the new Vivendi management determined the corporate acquisitions spree to be reckless and later sold MP3.com to CNET which now manages the site. Messier's buying spree accumulated billions of dollars in debt for his company and resulted in company shares falling to 20% of their previous value. Vivendi was compelled to sell off many other companies to scale down its debt.
After leaving MP3.com, Robertson started an OS technology company, Lindows. Since Lindows created a Linux based operating system designed to compete with Microsoft's Windows operating system, Microsoft filed trademark related lawsuits in the United States and abroad. Given that the trademarked "Windows" name was in some jeopardy, Microsoft paid to settle the lawsuit they initiated with a $20 million payment to Lindows and certain licenses with Lindows agreeing to change their name worldwide to Linspire.
Linspire championed an easy-to-use system for desktops and laptop computers and signed on popular retailers, both offline and online, including Walmart.com, TigerDirect, Frys and MicroCenter. Linspire was based on Debian (and later Ubuntu) with a KDE interface. Linspire was most distinguished by CNR, a one-click software download and installation system which also provided updates.
In 2008, Robertson attempted to sue Linspire's bank, Comerica, in an attempt to get Comerica to refund severance payments which had been made to laid-off Linspire employees. Robertson alleged the severance payments were actually funds which had been embezzled by the laid-off employees. The San Diego Police Department investigated and quickly came to the conclusion that this was a simple dispute between Robertson and Linspire's CEO at the time, Kevin Carmony, and no embezzlement or other crime had been committed. Robertson lost the lawsuit without it getting past summary judgment.
In an effort to defend the names of the former employees Robertson had unsuccessfully tried to have arrested for embezzlement, former-CEO Kevin Carmony launched a website critical of Robertson called Freespire.com in February 2008. The Freespire.com site states that it is "dedicated to shedding light on the REAL Michael Robertson," and discloses information and facts about Robertson. In an attempt to have the Freespire.com site taken down, Robertson had Linspire (renamed as Digital Cornerstone) file a lawsuit against Carmony, claiming the site violated trademark law. In 2010, Robertson lost the lawsuit with the court saying the site did not infringe on any trademarks and was protected as free speech. Judge Judith F. Hayes stated in her ruling, "...the Court finds the general purpose of the website to be a free speech forum wherein Defendant criticized the management of Plaintiff."
In 2003 Robertson founded SIPphone, which itself has seen legal action, filing suit against Vonage for false and misleading advertising including 'not disclosing the lock the company places on certain pieces of hardware'. The latest suit has been viewed as a publicity stunt, although Vonage later settled by altering their packaging and advertising to address the issues in the lawsuit. In addition to selling phone adapters and routers, SIPphone developed free VOIP software to compete with Skype based on the SIP standard called Gizmo5, which is available on a variety of platforms. On November 12, 2009, Google announced that it had acquired the company.
In February 2005, Robertson launched MP3tunes.com, which sold downloadable music. Robertson boasted that, unlike Apple's iTunes Music Store and most other competitors at the time, MP3tunes did not use digital rights management (DRM) technology to limit the use of songs its customers purchased. MP3tunes also provided Oboe, a digital music back-up service. MP3tunes stopped selling digital music in 2008.
Like Robertson's first online music company MP3.com, MP3tunes.com was sued for copyright infringement lawsuit by a major recording label, EMI, through its U.S. division, Capitol Records. The Capitol Records, Inc. v. MP3Tunes, LLC case had a mixed outcome, with the court holding that MP3tunes was generally not liable for copyright infringement by its users, but was liable in cases where takedown notices were ignored or where Robertson himself had seeded the site with unlicensed music. The decision was viewed as a victory for online storage and cloud music services, but the legal battle was very costly for the company.
MP3tunes filed for Chapter 7 bankruptcy on April 27, 2012. Included among the creditors were his lawyers ($1.4 million), several employees ($10,775), and even the coffee vendor ($96). The only secured creditor listed in the filing was Robertson himself, through his SKL Trust.
Founded in early 2006 by Michael Robertson (CEO) and Hisham El-Emam (CTO), Ajax 13 Inc. is a software development company that provides web-based applications written using XUL. It was started to pursue the software-as-a-service vision that is gaining momentum in both the enterprise and small business / home office marketplaces. Among the Ajax 13 products is ajaxWrite, a web-based word processor.
Education and personal life
Robertson lives in San Diego, California. His reported wealth has varied widely, but he has been on the Forbes 400 list once and twice on the Fortune 40 under 40, most recently in 2004. In 1999, he was named to the MIT Technology Review TR100 as one of the top 100 innovators in the world under the age of 35.
In April 2008, Robertson pleaded with the MP3tunes user group to help fund the legal defense regarding the EMI lawsuit.
Michael Robertson is founder of the Robertson Education Empowerment Foundation (REEF).
- Stone, Brad (February 28, 2011). "Michael Robertson Bucks the Music Industry Again". BusinessWeek: 35. Retrieved 2011-04-11. "Radio is dying because it's inconvenient and limiting," says Robertson. "The content is not interactive, and it's available on only a limited number of devices."
- MP3.com IPO prices over top of range
- MP3.com ordered to pay up to $250 million in music copyright case
- MP3.com pays $53.4 million to end copyright suit
- Stanford Law School Analysis of MP3.com Securities Violation Class Action Resolution
- UMG v MP3.com
- MP3.com is sold; all content to be deleted
- Messier's Legacy
- "Lindows And Microsoft Settle Suit". The New York Times. 2004-07-20. Retrieved 2008-10-12.
- "Declaration by San Diego Police Detective Michael McEwen".
- "Judge John S. Meyer Ruling in LINSPIRE INC VS. COMERICA BANK case".
- "Judge Judith F. Hayes Ruling in DIGITAL CORNERSTONE, INC VS. KEVIN CARMONY Freespire trademark case".
- "Freespire.com - Court-protected site critical of Robertson".
- EMI v Michael Robertson
- Greg Sandoval (August 22, 2011). "Court says MP3tunes protected by DMCA". CNET.
- Company Bankruptcy Information for MP3Tunes, Inc.
- "1999 Young Innovators Under 35". Technology Review. 1999. Retrieved August 15, 2011.
- Buzzya.com, Robertson email to MP3tunes users
- Q&A With Michael Robertson, Back Door, October 2002 • Vol.2 Issue 10
- Paul McCartney's Publishing Company Sues MP3.com(March 26, 2000)
- MP3.com Goes Major Labels League by Brad King of Wired News (July 20, 2001)
- EMI sues Michael Robertson for Copyright Infringement (November, 2007)
- Michael Robertson blog and home page
- Freespire.com - Information site about Michael Robertson
- Linux Format interview - July 2005