Warner Music Group announced its current quarterly sales this week; the company is narrowing down its loss more than it did in this time frame last year. And a lot of this gained income wasn’t from increased sales, it was because of the LimeWire settlement. LimeWire, once the leader of file sharing operation, cut a check for $12 million to Warner Music Group last quarter as part of its $105 million settlement program.

LimeWire, which was forced to shut down its services by a federal court order last year, has an agreement with Warner Music to pay $105 million to settle a copyright issue.

The music industry major player reported a $46 million loss in fiscal third quarter compared to a loss of $55 million in this time frame a year ago.

The P2P music trading company, LimeWire, got into trouble last year when their service was targeted by the RIAA and MPAA and  investigated by the FTC for copyright infringement and privacy issues. The FTC later dropped their probe into the privacy complaints on the ground that LimeWire had taken a step towards integrating protection on all their files and sensitive user information. But at the end of October LimeWire was finally found guilty for the infringement of a large quantity of copyrighted products and was forced to shut down. The company then closed their online music store by December 31, 2010.

In between, music industries filed a number of law suit against LimeWire for copyright infringement seeking monetary compensation. They include Sony, Warner, EMI, Peermusic, MPL Music Publishing and The Richmond Organization, Bug music and International independent record indie music right group, Merlin. Merlin filed a $5 million lawsuit against the ex-P2P service LimeWire. If you combined Warner Music and all other labels, LimeWire’s total damages are expected to count up to $1 billion.

LimeWire happened to be one of the first P2P file-sharing services taken in the music industries anti-piracy net. During its peak period more than 50 million visitors used to visit the sites for peer-to-peer file sharing. After their closure, reports claimed that P2P piracy rates dropped overall from 16% in 2007 to 9% in 2010 in the US. LimeWire is now replaced by more advanced cloud-oriented torrent concepts.