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SAN FRANCISCO – Napster escaped a legal mess Thursday when it settled a suit filed by heavy metal band Metallica, but the embattled song-swapping company still faces a federal judge’s order demanding the service remain offline until it prevents all unauthorized song trading. 

Napster promised to seek a stay from the 9th U.S. Circuit Court of Appeals after U.S. District Judge Marilyn Hall Patel told the company to stay offline until its file-sharing software is perfected. 

Napster CEO Hank Barry called Patel’s edict from the bench out of step with an earlier appeals court ruling. 

“Napster will obey this order, as we have every order that the court has issued. We believe the judge’s order is inconsistent with the 9th Circuit’s decision and wrong on a variety of other grounds,” Barry said shortly after a closed door hearing before Judge Patel. “We will appeal to the 9th Circuit on an expedited basis.” 

“We will continue to work with the technical expert and explore other options for resuming transfers as soon as possible.” 

Metallica and rap artist Dr. Dre settled their copyright suits against Napster. Financial terms were not disclosed, but as part of the agreement Metallica will allow some of the band’s songs to be traded on Napster’s new system once a legal business model has been launched. 

“I think we’ve resolved this in a way that works for fans, recording artists and songwriters alike,” said Lars Ulrich, Metallica’s drummer. 

Napster has been offline since July 2, when the Redwood City-based company took down its computer servers after its upgraded audio fingerprinting technology failed to catch all of the copyright music being traded by online users. 

Napster was ready to restart its service, claiming it had retooled the screening software to block more than 99 percent of unauthorized song files. 

However, Judge Patel shot down the notion that Napster could quietly come back online without 100 percent effectiveness. She told the company not to restart the service until it could prove to her that no unauthorized song files would get through the system. 

It means a further delay for Napster’s return. Napster’s user numbers had already been in decline since it began employing strict song-sharing guidelines earlier this year to block access to prevent copyright songs. 

The number of Napster users and the songs shared among them fell drastically between February and June of this year. Many disgruntled former Napster fans have migrated to decentralized file-sharing networks made popular by software called Gnutella. 

Gnutella and other similar programs like LimeWire and BearShare allow users to access an ever-changing network of servers and download image files and software programs in addition to MP3 song files. 

As Napster users flock to alternative programs, the company has been buying time until it can launch its much anticipated paid subscription service, due this summer along with two similar services by the major record labels. 

The recording industry, which sued Napster in 1999 for copyright infringement, was elated with Patel’s words from the bench. 

Hilary Rosen, president of the Recording Industry Association of America, issued a statement late Wednesday in response to Patel’s order. 

“While we appreciate that Napster is attempting to migrate to a legitimate business model, its inability to prevent copyright infringement from occurring on its system has only hampered the development of the marketplace in which it now hopes to compete. It is difficult for the legitimate online marketplace to compete with free,” Rosen said.