Global Gaming Factory X, the Swedish software/Internet cafe company that’s supposed to buy the file-sharing haven for $8 million, was supposed to get shareholders to approve the deal today. But in advance of a shareholders meeting, the company issued a press release in which it says 1) that investors that were supposed to finance the deal have disappeared and 2) this is the fault of the U.S. media, which it says spooked said investors.

But wait! There’s more! Global Gaming Factor says it has figured out an alternate way to pay for the deal whereby the company’s majority shareholders in the penny-stock company will offer their equity as a security. Alas, there’s yet another catch: Swedish regulators, who have already suspended trading in the company twice in two months, are now threatening to delist it.

It’s hard to get too worked up about the failure of a plan that made no sense on the day it was announced. But for the record, you can read the backstory to this weird tale here and here. Meanwhile, The Pirate Bay itself is up and running and still cheerfully thumbing its nose at Hollywood, the big music labels, and the rest of the media world.

Since announcing its plans in June, Swedish software company/Internet cafe outfit Global Gaming Factory X has seen a succession of allies jump ship.

Last month, the company worked with file-sharing veteran Wayne Rosso for three weeks before Rosso left, claiming the company had credibility problems and hadn’t paid his bills. Now, CNET reports that Peerialism, a technology company that was “integral” to Global Gaming’s plans, is having second thoughts–in part because it hasn’t seen any money, either. Greg Sandoval:

When it was announced in June that Global Gaming Factory X, would acquire The Pirate Bay for about $8 million, the Swedish software company said it would also pay about $13.5 million to obtain Peerialism….

But [Peerialism CEO Johan] Ljungberg told CNET News on Thursday that at the very least Pandeya will not make some of his deadlines for opening a restructured Pirate Bay, the world’s best known file-sharing site. That’s because much of the preparation has yet to be started.

More than two months ago, Pandeya hired Peerialism to begin doing some of the production work. Pandeya agreed to pay half the money upfront and the other half when the job was completed.

“That was two months ago but he hasn’t paid anything,” Ljungberg said. “We have his signature on the contract, but he hasn’t paid and we haven’t done the work…We’re not quite comfortable with the situation. We had really high hopes and ambitions for our technology but I’m not sure if this is the right home for it.”

I wanted to get Global Gaming’s response to the CNET story, so last night I pinged CTO Johan Sellstrom, whom I had corresponded with in early July. At the time, Sellstrom described his company’s plans as “the last chance for the media industry to come up with a new solution before everything goes to the dark side.” But Sellstrom now says that he left Global Gaming on July 15; he hasn’t explained why he left.

UPDATE: Swedish stock market regulators have suspended trading in Global Gaming’s stock today; the same thing happened a week before the company announced its Pirate Bay plans.

UPDATE 2: This might explain Sellstrom’s departure: A Swedish newspaper report says Sellstrom claims that his former employer owes him $840,000.

I’ve already gone on record: I don’t think Global Gaming’s plan has any chance of working, even in the best of circumstances.

But I’m always happy to hear what the company itself thinks. I’ve asked Global Gaming CEO Hans Pandeya for comment, but haven’t heard back. In the meantime, you can read translated accounts of a recent press release assuring investors that everything is hunky-dory, and that the company will own Pirate Bay by the end of the month.

A reminder of the site’s outlaw status is splashed up on the site’s front page right now, in the form of a feature promoting “DJ Joel’s $675,000 Mixtape,” which is supposedly “Approved by the RIAA,” the U.S. lobbying/litigating arm of the big music labels.

It’s not approved by the RIAA, of course. Instead, the feature steers visitors to a page that where they can illegally download 30 songs that just cost grad student Joel Tenenbaum $675,000. That’s the amount a federal jury decided he owed the RIAA after being found guilty of copyright violations for sharing the tunes via a filesharing network.

It’s the kind of cheeky move The Pirate Bay revels in and one of the reasons the Web site has such a large and devoted base of users. The main reason, of course, is that The Pirate Bay is a huge repository for free, illegal copies of movies, music, games.

That’s supposedly going to stop after August 27, when Global Gaming Factory X, a Swedish software/Internet cafe outfit, says it will go through with plans to buy the site, and then try to make it legal.

As I’ve explained before, there’s no chance that will happen.

Even if the deal really goes through, the only way The Pirate Bay’s users will stick around is if they can continue to grab whatever they want, whenever they want. And there’s no way the big music labels and movie studios and videogame companies, et al, are going to go for that.

But it will be interesting to watch!

In the meantime, here’s the track listing for the 30 songs that landed Tenenbaum in trouble. I’m pretty sure most of them are available at Apple’s (AAPL) iTunes store:

01 – Incubus – New Skin
02 – Green Day – Minority
03 – Outkast – Wheelz of Steel
04 – Incubus – Pardon Me
05 – Nirvana – Come As You Are
06 – Green Day – When I Come Around
07 – Green Day – Nice Guys Finish Last
08 – Nirvana – Heart Shaped Box
09 – Nine Inch Nails – The Perfect Drug
10 – Blink 182 – Adam’s Song
11 – Limp Bizkit – Rearranged
12 – Limp Bizkit – Leech
13 – Linkin Park – Crawling Hybrid
14 – Deftones – Be Quiet And Drive
15 – The Fugees – Killing Me Softly
16 – Red Hot Chili Peppers – Californication
17 – Red Hot Chili Peppers – By The Way
18 – Red Hot Chili Peppers – My Friends
19 – Beck – Loser
20 – Eminem – My Name Is
21 – Eminem – Drug Ballad
22 – Eminem – Cleaning Out My Closet
23 – Beastie Boys – (You Gotta) Fight for Your Right (To Party)
24 – The Ramones – The KKK Took My Baby Away
25 – Monster Magnet – Look To Your Orb For The Warning
26 – Aerosmith – Pink
27 – OutKast – Rosa Parks
28 – Rage Against The Machine – Guerrilla Radio
29 – Goo Goo Dolls – Iris
30 – Aerosmith – Water Song/Janie’s Got A Gun

So this one doesn’t even faze me: Swedish regulators are looking into insider trading charges at Global Gaming Factory X, which saw shares jump several days before it said it would buy The Pirate Bay.

From Wired (via PaidContent):

AktieTorget, a Swedish exchange listing some 116 public companies, suspended trading in Global Gaming a week before the announcement as trading volume and share prices jumped without public news to account for it.

“There are reasons to suspect that information was leaked,” said Peter Gönczi, executive vice president at AktieTorget.

Before the sale, average daily volume in Global Gaming was about 162,000 shares. From June 5 to June 18, there was little trading in the stock with an average price of about 9 cents. On June 22, shares nearly doubled to 18 cents with 1.2 million shares sold before trading was halted.

Trading resumed Tuesday, the day of the announced purchase, and shares closed at a high of 38 cents, with a heavy volume of 5.8 million shares traded. Trading closed at 25 cents Wednesday, down 13 cents, and the volume was nearly 7 million shares traded.

But I have a question: Why would anyone think that Global Gaming Factory X shares would be worth more once this news got out?

The company’s announced plan–to sell legal downloads to users who flock to the site for free downloads and to somehow resell bandwidth its users generate to the likes of Comcast (CMCSA) and AT&T (T)–is a nonstarter. If anything, you’d expect insiders to be dumping whatever shares they owned in advance of the news, right?

I’m going to go out on a limb and assume that Swedish penny stocks are like U.S. penny stocks–murky caveat-emptor things that widows and orphans want to avoid. So it’s hard to get too worked up about this or try to puzzle it out. Still, if anyone wants to explain it to me, I’m all ears.

You can read a confusing release from the supposed acquirer, Global Gaming Factory X, here, and an equally confusing post from The Pirate Bay’s operators, here. And The Pirate Bay guys, who are supposedly looking at a big fine and a jail term, say they didn’t actually own The Pirate Bay but will get some of the profits from the sale anyway and will use them to finance an “Internet project.” Etc.

Oh! And the Pirate Bay’s new owners say they can’t promise that copyright holders are actually going to get paid. Here’s Global Gaming CEO Hans Pandeya in the Financial Times:

However, Mr Pandeya said the company would not be able to compel any filesharers to pay content owners. “We are trying to create a different model that addresses the needs of the different parties. However, it is up to them if they want to participate,” he said.

So it’s understandable that Hollywood and big music are mute, or close to it, on the deal. Because it’s difficult to say exactly what the deal is. I was able to extract one statement from the IFPI, the international music trade group. Here’s chairman and CEO John Kennedy:

“We don’t know the details and there are many questions to ask about how this will work in practice, but we would be delighted if this resulted in the Pirate Bay turning into a legitimate licensed service.”

But let’s be honest: There’s no way The Pirate Bay is going legit. And if it does, it won’t be The Pirate Bay, but something else.

Instead of being a massive site that attracts a huge audience that wants to devour free content, it will be a small distributor of licensed content, and the masses will flock somewhere else for their free stuff. Because they don’t want licensed content, even if it’s legal and/or better quality. They want free stuff.

The movie studios and the labels should be able to pat themselves on the back, gently and cautiously, for getting The Pirate Bay’s current owners to more or less abandon the site.

The problem, as they’re well aware, is that The Pirate Bay was only a directory that sent users to “torrents” that allowed them to gobble up as much pirated stuff as they want. And shutting down the Bay doesn’t mean the torrents are gone. And it doesn’t prevent other directory sites from popping up, whack-a-mole style, all over the world.