The file-sharing decision is good news for the Internet, even if it complicates life for the media giants.
When it comes down to it, the old Sony and Napster beat the new Sony. Sony Music Entertainment, along with a whole pile of big and not-so-big names in the music and movie businesses, got a big shock on April 25 when a U.S. district court judge in California ruled that Grokster and Morpheus did not themselves violate copyright law.
Gibbs says: Common sense has won out.
There was a little bit of irony in the judge’s opinion because it depended heavily on the 1984 U.S. Supreme Court decision that supported Sony’s ability to sell VCRs and on the 2001 decision that closed down Napster. This decision is good news for the Internet, even if it complicates life for the media giants.
In this case, both sides agreed that a major use of these peer-to-peer applications was to share copyrighted material illegally. But a general knowledge of illegal activity is not enough to make a company guilty of contributory copyright infringement (the main accusation in this case).
The Supreme Court, in the Sony VCR case, said a technology could not be banned just because it might be used to infringe copyright as long as there were “substantial noninfringing uses” of the technology. In that case, the Supreme Court found that there were such uses for VCRs. In the current case, the district court found that the parties agreed there were substantial noninfringing uses of Grokster and its like, for example, sharing movie trailers, free songs or the works of Shakespeare.
Another requirement of contributory infringement is that there must be actual knowledge of a specific infringement when the defendant materially contributes to that infringement and when the defendant actually could stop the particular infringement. The distributed design of these applications meant that the people who distributed the file-sharing software (the defendants in this case) could not know what files were being shared nor could they block a file from being shared even if they were told about it.
When boiled down to their essence, the media companies’ claims were that because Grokster could be, and was, used for copyright infringement, it had to be banned even though Grokster’s distributors had no control over what was shared. This is basically the same argument that was used against Sony in 1984. If this argument were to win, any tool that could possibly be used to do something wrong could be banned. This could cover CD and DVD burners, PCs, MP3 players and the Internet.
I heard the same basic argument from a number of readers who complained that I had not discussed in my column of a few weeks ago the liability of people offering free Wi-Fi Internet access. This decision might make it harder for any such liability to be proved – open Wi-Fi access does not meet the requirements above. Thus, if the same logic is used, it might be hard to show any liability.
The media companies do have a real problem and the widespread use of technologies such as Grokster and CD burners deprives them of legitimate revenue. But saying the Internet and just about every other modern technology are weapons that must be banned is not the answer to their problem. The court agrees.
Disclaimer: Some B-school and law school graduates are not angels, but I would not want them classified as weapons. In any case, the above is me playing a lawyer and not a Harvard opinion.
