By Andy North
The Internet’s second largest peer-to-peer file-sharing Web site has filed bankruptcy and will be auctioned to the highest bidder.
Dec. 12 is the set date for the auction of Scour Exchange’s assets.
Scour Exchange, which was similar to Napster, allowed its users to swap music, photo and even movie files.
In July, the Motion Picture Association of America, the Recording Industry Association of America and the National Music Publishers Association filed a joint suit against Scour for copyright infringements.
An October news release from Scour announced it had voluntarily filed chapter 11 bankruptcy.
Scour Spokeswoman Dawn Rusalov said litigation made it difficult to do business, which was the main reason the bankruptcy was filed.
“At the time the bankruptcy was filed, Scour listed its potential damages at $250 billion if they were to lose the case,” Rusalov said.
She said the company assets will be auctioned off to the highest bidders on Dec. 12 and in order to bid companies need to put down a deposit of half a million dollars by Dec. 5.
Rusalov said Listen.com has already offered a bid of $5 million and 500,000 shares of its stock.
Toby Dorshel, a spokeswoman for Listen.com said the company is interested in developing the technology in order to expand its services.
She said the acquisition would give Listen.com control of Scour’s assets without being responsible for the legal issues.
The possible transaction has brought support from management of both companies.
“The board and Scour management support the Listen.com acquisition, and we believe it is in the best interest of all the company’s constituents,” said Dan Rogers, Scour president.