James Delahunty
27 Jun 2005 7:25
In a major blow to technological innovation today, the U.S. Supreme Court ruled in favour of Metro-Goldwyn-Mayer in a huge P2P case. Since the case began in March, Justices showed concerns over holding the inventors liable for copyright infringement as they believed it could discourage new inventions, but obviously their minds were changed as the ruling was passed unanimously today. However, it't not all the entertainment industry hoped for and Grokster and Morpheus remain complete legal software.
The entertainment companies accused Grokster and StreamCast Networks (which owns the Morpheus P2P software) of promoting their products to be used for piracy and it seems it was enough to convince the court to partially set-aside an older appeals court ruling in favour of Grokster and StreamCast. "We hold that one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties." Justice David Souter wrote for the court.
Case History
Now we’ll take a look at how this P2P case ended up in the Supreme Court in the first place.
April 25th 2003, Los Angeles
A federal judge in Los Angeles ruled that StreamCast and Grokster were not liable for copyright infringement that took place on the P2P networks. "Defendants distribute and support software, the users of which can and do choose to employ it for both lawful and unlawful ends," Judge Stephen Wilson wrote in his opinion, "Grokster and StreamCast are not significantly different from companies that sell home video recorders or copy machines, both of which can be and are used to infringe copyrights." This ruling had shocked the entertainment companies whom in the past had victory in cases like this.
"This is a very serious setback for the record industry and other content industries, because they've uniformly won these cases in the U.S.," Mark Radcliffe, an intellectual property attorney at Gray Cary Ware & Freidenrich said. The MPAA were deeply disappointed with the decision and vowed to appeal it. "We feel strongly that those who encourage, facilitate and profit from piracy should be held accountable for actions," MPAA spokeswoman Marta Grutka said. "We're hoping that people aren't taking this as an invitation to continue along the path of what is clearly illegal activity." Of course the entertainment company’s did appeal the ruling.
See: https://www.afterdawn.com/news/archive/4022.cfm
August 19th 2004, Court of Appeals in Pasadena, California
The entertainment companies felt that the April 2003 decision was unfair and were confident that the appeals court would over-rule the decision. "The services are profiting to the tune of millions of dollars from music that is written by songwriters who are not getting a dime from the use of their music on these services," said Carey Ramos, a lawyer for the plaintiffs. "We believe that the (lower court's) conclusion is fundamentally unjust." However, Fred von Lohmann, senior staff attorney for the Electronic Frontier Foundation saw the case differently. "This is not just a case about peer-to-peer," he said, "It is a case that will determine whether technology companies are allowed to innovate or whether they have to ask permission from copyright owners before they build new products."
See: https://www.afterdawn.com/news/archive/4935.cfm
To the shock and dismay of the entertainment companies, the U.S. Court of Appeals for the Ninth Circuit found Grokster Ltd, Streamcast Networks Inc. and Sharman Networks Ltd fundamentally different from for example Napster in the sense that the services do not have a central server. According to Judge Sidney R. Thomas "The technology has numerous other uses, significantly reducing the distribution costs of public domain and permissively shared art and speech, as well as reducing the centralized control of that distribution." This left the entertainment companies the option of appealing to the U.S. Supreme Court. "We are carefully reviewing our next steps," said Jack Valenti, who was then president of the MPAA.
See: https://www.afterdawn.com/news/archive/5496.cfm
So how does this decision affect the common file sharer?
For now the question should be more along the lines of how does this affect common consumers. Many believe that the entertainment industry will take advantage of the ruling and use it in other cases besides P2P. While the entertainment industry takes the stance that it wouldn’t sue a company like Apple for example, over the iPod music player, the device can still be used to store stolen music, which was a fact pointed out in the Supreme Court.
However it seems like some other developers like the creator of BitTorrent, Bram Cohen, for example as he never promoted BitTorrent for use with piracy. The problem is that some P2P services would advertise their services with vague comments like "Find and download music files quickly and easily" - It seems this could be seen as encouraging piracy on the network?
Source:
News.com