A California company called BlueBeat has been selling MP3 tracks for 25 cents each and streaming them for free. Online music retail is pretty much old news, though the price point is low enough to attract attention. But as Macworld’s Jonathan Seff wrote, the site is also selling the Beatles’ catalog — without a license. Seff pointed out that the site’s terms of use say that if users feel that the music posted to the site has been uploaded in violation of the Digital Millennium Copyright Act, then they can contact the people running the site to have it removed.

There’s also a warning, Seff said, that false accusations can be penalized under the DMCA.

Well, apparently EMI, the company that owns the rights to the Beatles’ catalog, filed a lawsuit for copyright infringement and had a temporary restraining order granted to stop the site from continuing its business. When I checked a few moments ago, the site was completely unavailable.

Nate  Anderson at Ars Technica wrote yesterday that the company that runs BlueBeat.com, Media Rights Technologies, is claiming that what the site is doing is completely legit. Why? Because it owns the copyright to the music it sells. Anderson wrote that, in a reply to Recording Industry Association of America general counsel Steven Marks, Media Rights Technologies CEO Hank Risan said he is the author of the music files, which were created using a process called psycho-acoustic simulation. The company has filed for copyright protection on the songs.

MRT said, in a response to the lawsuit, that the company doesn’t feel the plaintiff will succeed because the two recordings are completely different. You see,  according to U.S. copyright law, if there’s a new recording of a song featuring different sounds, then that’s considered a new work.

Anderson said that MRT is taking the Beatles’ (and other artists’) tracks and adding video content to them that can only be seen with the company’s proprietary player. Thus, according to the company, these are new audio-visual works.

I don’t think that MRT will succeed in this case. And I’m far from the only one. I suppose we’ll see.

For more on MP3s and related tech, take a look at these articles:

How MP3 Files Work
How Streaming Video and Audio Work
How iTunes Works