Los Angeles - The government of Antigua is threatening to legalize piracy of U.S. music and movies -- with World Trade Organization approval -- should the U.S. fail to end a running dispute over the legality of Internet gambling, Variety reports.

The WTO ruled in December that Antigua could ignore IP agreements with the U.S. if the U.S. failed to negotiate a settlement.

The WTO ruled previously that U.S. laws banning overseas online gambling -- while exempting domestic Internet gambling on horse racing -- are in violation of international trade agreements.

An attorney representing Antigua told Variety the island nation is likely to make such a move by the end of this month.

"It is not our preferred option to punish the MPAA or others for the U.S. government's intransigence, but the U.S. has refused to negotiate fairly," Mark E. Mendel, who represents Antigua, told Variety.

"The reality is, yes, we have to go before WTO and request their authorization for IP sanctions against the U.S., but we can do that at any time and the WTO will agree. That is 100% guaranteed."

Mendel told Variety that Antigua would like the MPAA and other U.S. IP interests to pressure the Bush administration into a "preferred" settlement, which would allow online gambling between Antigua and the U.S.

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