StreamCast fails to sue Skype for $4 billion

The company behind file-sharing software Morpheus has lost its case against Skype and its founders Niklas Zennström and Janus Friis.

StreamCast Networks had claimed that it had rights to some of the underlying technology used by internet phone firm Skype.

US District Judge Florence-Marie Cooper threw StreamCast's claims out, ruling that it had failed to make its case for damages. StreamCast had sued for a share of the $4.1 billion that eBay paid for Skype 18 months ago.

The suit was filed under anti-racketeering legislation and claimed that it had first refusal rights to FastTrack, a technology which underpinned Zennström and Friis's previous venture, file sharing software firm Kazaa.

StreamCast claimed some rights to FastTrack, and said that FastTrack is used in the routing of Skype phone calls around the internet. It said that Zennström and Friis had profited enormously from Skype and its sale to eBay, and that it was entitled to some of that money.

Cooper ruled that the case was not proven under federal antitrust laws and dismissed the claims made against Skype and its owner eBay.

StreamCast General Counsel Matthew Neco told the AP news service that the company would appeal the ruling or may pursue the case in state courts. The judge had had the opportunity to apply state laws, such as unfair competition laws, to the case, but did not use it.

"This case is far from over," Neco told AP.