It filed suit against four college students involved in Internet file-sharing (in which compressed "files" of music are swapped, Napster-style), asking for billions of dollars in damages.

The five major record companies are struggling to gain ground in a market that has shrunk in part because of free Internet file-sharing and a sluggish economy.

Internet file-sharing may be making it harder to turn a hit into a sales blockbuster, while consumers have so many choices that they have grown fickle.

They try to combat the idea that Internet file-sharing is a victimless crime by presenting, in the person of Mr. Goldstein, Mr. Perry and their co-workers, some of the potential victims.

I Have Become What I've Always Hated is an EP containing music by American rock band Saosin, released by fans via Internet file-sharing in 2003.

Indeed, far from being supremely lucrative, commercial piracy is under pressure from the same force pressing on legal distribution: free Internet file-sharing.

The biggest issue in intellectual property today is how to handle Internet file-sharing, and Lessig has some interesting thoughts.

"The full impact of Internet file-sharing and the downturn of the economy hit at a time when Puff Daddy was revving up to get a big new deal," Steve Wonsiewicz, editor of Sound Values, a monthly record industry financial newsletter.

Industry executives blame Internet file-sharing and counterfeiting for the decline, while consumers complain of a lack of exciting new talent and uninspired music from older artists.

In the last month, more than 340,000 people have helped to give away the band's songs by offering free downloads on file-sharing services like KaZaA, according to BigChampagne, a company that monitors Internet file-sharing.