Napster files for Chapter 11 bankruptcy, seeking protection during Bertelsmann takeover
Monday, June 3rd 2002, 12:00 am
By: News On 6
SAN FRANCISCO (AP) _ Napster Inc. filed for Chapter 11 bankruptcy Monday, seeking court protection from creditors as music industry heavyweight Bertelsmann AG takes over what's left of the Internet music-swapping service.
Bertelsmann said May 17 it would buy Napster for $8 million _ slightly more than half what it had previously offered to purchase the company _ to pay Napster's creditors as part of a financial reorganization that included plans to file for bankruptcy.
The filing was made in Wilmington, Del.
Calls to a Napster spokeswoman were not immediately returned Monday.
The bankruptcy filing is the swan song for a company that three years ago set off a frenzy of online song-swapping that attracted millions of users, as well as the anger of the recording industry, which sued for copyright infringement.
At its peak, Napster boasted some 60 million users and seemed at once to symbolize both the excitement of the digital revolution and the worst nightmares of the established recording industry.