first_imgYouTube may become a more tantalizing target for copyright owners and their lawyers now that it’s owned by Google, a moneymaking machine that had accumulated $10.4 billion in cash through September. 160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! AD Quality Auto 360p 720p 1080p Top articles1/5READ MORESurfer attacked by shark near Channel Islands calls rescue a ‘Christmas miracle’But the escrow account’s existence means YouTube’s former owners – a small group led by co-founders Chad Hurley, Steve Chen, Jawed Karim and Sequoia Capital – may never receive a substantial portion of the Google stock if YouTube runs into legal trouble or incurs other losses. The percentage of stock being held in escrow translates into about 457,000 Google shares worth about $224 million after the company’s stock price rose $8.27 Tuesday to close at $489.30 on the Nasdaq Stock Market. The reserve could signal that Google is trying to insulate itself from a possible onslaught of lawsuits aimed at the large number of pirated videos posted on YouTube, which will retain its current management and name. Since its Web site first began to catch on about a year ago, YouTube has relied on a mix of homemade and pirated videos to expand its audience. Although YouTube has promptly removed pirated videos whenever copyright owners complained about violations, questions have continued to linger about the site’s vulnerability to legal claims for distributing content owned by other media. SAN FRANCISCO – Google Inc. has set aside more than $200 million in its just-completed takeover of YouTube Inc. as a financial cushion to cover losses or possible legal bills for the frequent copyright violations on YouTube’s video-sharing site. Without elaborating in a late Monday statement, Google said it is withholding 12.5 percent of the stock owed to YouTube for one year “to secure certain indemnification obligations.” The Mountain View-based company disclosed the escrow account in an announcement commemorating the completion of its much-anticipated YouTube acquisition. As of Tuesday afternoon, Google representatives hadn’t responded to requests for more details about the escrow account. Buying San Bruno-based YouTube cost Google 3.66 million shares of its prized stock, including a convertible warrant. As of Tuesday, those shares were worth $1.79 billion – above the targeted purchase price of $1.65 billion announced last month. last_img

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