U.S. District Judge Stephen Wilson ruled that the RIAA and MPAA could sue the company behind file sharing site KaZaa on American soil, despite the company being based in the Pacific island nation of Vanuatu.

"Given that Sharman's (Kazaa) software has been downloaded more than 143 million times, it would be mere cavil to deny that Sharman engages in a significant amount of contact with California residents," Wilson wrote.

KaZaa "should be held accountable by U.S. laws, which clearly indicate that what they are doing is illegal, and that they should not profit from it," the RIAA and MPAA said in a joint statement.