Napster is considering filing for Chapter 7 bankruptcy protection, cementing the recording industry's victory over the once hugely popular online music swapping service. Chapter 7 involves complete liquidation.
The company, whose operations were halted last year after a federal court stopped it from offering copyrighted music for free over the internet, is also losing Konrad Hilbers, its chief executive, Shawn Fanning, the founder and chief technology officer, and four other vice-presidents.
The resignations followed the breakdown of talks with Bertelsmann, the German media group, which had provided loans to Napster and wanted to take a majority stake in the company. The board is understood to have been split over the terms of the sale. Bertelsmann was offering between $15m and $20m for the stake.
