Grooveshark did not make a stand against the music industry. They made a stand against Google and the RIAA. Seems like Google is afraid of the RIAA and just drops anything from the store the RIAA doesn't like.
As much as the RIAA has done terrible stuff and earned their status as a boogieman, aren't they the main representatives of the music industry? It isn't like the music labels are not the ones behind the RIAA's actions.
I believe the subtlety there is that the RIAA represents the interests of their corporate members, which almost wholly differ from the artist's interests.
I also believe that is one of the main reasons they are labeled as "the boogieman," in addition to some pretty boneheaded PR moves.