Bertelsmann, the complaint argues, prolonged the life of online song-swapping service Napster by investing more than $100m into it, the suit said.

This act that amounted to "participation... in the widespread infringement of copyrighted music works".

Bertelsmann has refused to comment on the lawsuit, which has been filed at a Manhattan federal court, and could not even confirm it had been notified of the action.

Failed ambitions

Napster, briefly one of the best-known sites on the web, closed in mid-2001 under a barrage of attacks from the music industry.

Record companies and some artists were concerned that its free distribution of music - among some 60 million fans at its peak - would fatally undermine their revenues.

Bertelsmann, itself one of the world's leading music companies, invested in Napster with the aim of turning it into a subscription service.

But Bertelsmann's hopes proved misplaced, and the plaintiffs argue that Napster would have gone under much earlier with Bertelsmann's intervention.

Nor was the German firm acting wholly innocently, the lawsuit alleged.

Bertelsmann "made a deliberate and calculated business decision to continue the infringing service in order to preserve Napster's valuable user base for Bertelsmann's own benefit", the complaint said.

Roxio in the clear

Bertelsmann has attempted to cover itself against any potential legal challenge by pointing out the $100m was just a loan.

But, ironically, Bertelsmann could also prove a beneficiary of the legal challenge.

If the initial lawsuit proves successful, it could be escalated to cover members of the Harry Fox Agency, which represents more than 27,000 song publishers - including Bertelsmann's own BMG division.

Napster eventually filed for bankruptcy protection, and its assets were sold to Roxio, a firm that produces CD-burning software.

Under the terms of its deal, Roxio has avoided any of Napster's potential liabilities.