A Moscow court threw out a case against the former head of music downloading site allofmp3.com and rejected the damages claims made by three major recording labels, a music industry official said Wednesday.

Allofmp3.com, which was closed in late June but reopened later under a similar rubric, has been cast as the epitome of Russia's shoddy copyright enforcement and repeatedly held up by U.S. trade negotiators as imperiling Moscow's bid to join the World Trade Organization.

Recording companies argued that Mediaservices, which runs the sites, has never had permission to sell their artists' works.

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EMI Group PLC, Vivendi SA's Universal Music Group and Warner Music Group Inc. (WMG) sought $587,000 in damages from Mediaservices' former head, Denis Kvasov, according to Igor Pozhitkov, the Russia representative for the International Federation of the Phonographic Industry.

Pozhitkov said a Cheryomushky District Court judge threw out the case against Kvasov, saying that a legal loophole that allowed the online distribution of music was only closed in September 2006, while Kvasov ended his involvement in December 2005.

Pozhitkov criticized the ruling, saying the judge ignored the prosecutors' argument that Kvasov had reproduced the music in question, an illegal act at the time.

Two more cases against allofmp3.com are pending, including one against Mediaservices' current head, Vadim Mamotin, Pozhitkov said.

Mamotin has insisted that by paying royalties to a Russian licensing group, allofmp3.com was in compliance with Russian laws.

Recording companies contend, however, that the licensing group never had the permission of music industry to collect and distribute royalties on its behalf.