The hearing is part of a case brought against P2P networks KaZaA, Grokster and Morpheus which argues that they knowingly allow the exchange of copyrighted digital works on their networks.
Sharman Networks, which is headquartered in Australia and operates from the Pacific island of Vanuatu, claims that it has no substantial business contacts with the US and therefore it cannot be sued there. The company has recently abandoned a plan to launch a subscription service that would have been available to US residents.
The company also denied that it is trying to avoid legal action against it, claiming that copyright owners can bring their case before an Australian court.