Popular download site TorrentSpy has lost its case against the Motion Picture Association of America (MPAA) and has been ordered to pay $110m in damages.
US District Judge Florence-Marie Cooper imposed a fine of $30,000 on the site's owners, Justin Bunnell and Wes Park, for 3,699 cases of copyright infringement.
The site has been offline since 24 March, and Bunnell and Park have declared themselves bankrupt.
"The legal climate in the US for copyright, privacy of search requests, and links to torrent files in search results is simply too hostile," Bunnell and Park said on the TorrentSpy site.
"We spent the last two years, and hundreds of thousands of dollars, defending the rights of our users and ourselves.
"Ultimately the Court demanded actions that were inconsistent with our privacy policy, traditional court rules and international law.
"Therefore, we now feel compelled to provide the ultimate method of privacy protection for our users - permanent shutdown. It was a wild ride."
Dan Glickman, chairman of the MPAA, said in a statement: "This substantial money judgment sends a strong message about the illegality of these sites.
"The demise of TorrentSpy is a clear victory for the studios and demonstrates that such pirate sites will not be allowed to continue to operate without facing relentless litigation by copyright holders."
The MPAA began its action in 2006 for "abusing technology to facilitate infringement of copyrighted works".
Bunnell and Park were found guilty in December 2007 of tampering with evidence, in particular log files, and lying under oath.
