A U.S. JUDGE Tuesday blocked the sale of Napster's assets to media giant Bertelsmann in a move that could nix the best-known music swapping site's attempts to get back up and running.

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Judge Peter Walsh of the U.S. Bankruptcy Court for the District of Delaware, in Wilmington, Delaware, handed down the decision blocking Napster's sale for $8 million to Bertelsmann, the companies confirmed. Napster filed for Chapter 11 bankruptcy protection last June despite Bertelsmann providing close to $100 million in loans and other financing to the company. Other record labels and music publishers had objected to the sale.

"Napster is disappointed with the bankruptcy court's decision not to approve the sale of the company's assets to Bertelsmann," said Konrad Hilbers, chief executive officer of Napster, in a prepared statement.

"As a result of the record companies' and music publishers' opposition, Napster's creditors will be denied substantial repayment and the company will likely be forced into Chapter 7 liquidation. As with most start-up technology businesses, Napster's technology is of little value without the talented team that created it, so it is an occasion of loss on many levels, Hilbers said in the statement.

Despite Bertelsmann's heavy investment in Napster, officials of the company appeared less frustrated with the judge's decision.

"We accept the court's decision that the sale of Napster's assets to Bertelsmann has been denied and that the purchase will not proceed," the Gütersloh, Germany-based company said in a statement.

Napster has been fighting to bring its music trading service back online since a San Francisco court ordered the company to shut down, mostly because it helped users trade copyright-protected material.