"...Hewlett-Packard GmbH (HP) must pay intellectual-property fees on CD burners retroactively for three years, a German court ruled on Thursday. HP said it will appeal the ruling. The ongoing legal battle seeks to determine whether buyers of the devices must pay a flat fee to offset losses sustained by authors and artists whose work is duplicated without their permission. HP is fighting the test case on behalf of all hardware makers.

Negotiations between manufacturers and authors'-rights guilds collapsed earlier this year, after HP withdrew an initial agreement to pay 12 marks (US$5.25) on each new CD burner sold. The preliminary ruling orders HP to divulge how many of the devices it has sold in Germany since February 1998, said Harald Heydlauf, a spokesman for the Landgericht Stuttgart state court. The court has yet to set the amount of the fees.

HP said it rejects the ruling. The old system of flat fees on duplication devices -- which was originally devised for photocopiers and tape recorders -- cannot be carried over to the "digital world," the company said in a statement.The company said copyrighted materials can be better protected through a system of individual licensing and per-use fees..."