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Viacom Inc. sued YouTube.com and its parent company Google Inc. for $1 billion in damages over copyright infringements. According to Viacom, 160,000 copyrighted video clips have been illegally uploaded and viewed on YouTube.com, including clips from MTV, Comedy Central and Nickelodeon. It should be difficult for Google to defend themselves, as they are clearly making money from materials they do not own.

Other media companies have considered lawsuits against YouTube too, but some have reached licensing agreements with the popular video-sharing site. For example, CBS Corp., NBC Universal and Universal Music Group.

As a result of the lawsuit, Google’s shares dropped 2 per cent. Viacom’s shares rose 1.2 per cent.