New challenge to file-sharing designers
The Supreme Court’s unanimous (but in some ways divided) ruling on the use of copyright laws to try to stop the massive sharing over the Internet of music and movie files posts a significant legal warning to software designers, but does not turn them into complete copyright outlaws.
Given some ingenuity, both in software design and in marketing tactics, it is conceivable that digital file-sharing technology – available free — may yet be quite legal. Justice David H. Souter’s opinion for the Court, in fact, provides a reliable guide to avoiding copyright liability for such software. It apparently was written in that way to try to avoid the risk of stifling ingenuity in software design.
The technology alone, Souter made clear, does not by itself run afoul of the copyright laws. The chief characteristic of download-and-share software is that it enables the use of the Internet to reach files, some of which may be copyrighted works. If that were all that a software company did, according to the opinion, legal fault would not yet exist – especially, if it crafted the design in such a way as to filter out copyrighted material. In addition, the mere fact that the developer knows someone may or even will use the software to purloin copyrighted files, the Court made clear, is not sufficient, either.
What counts most of all, it is apparent, is that a software developer promote the use of the product explicitly to stimulate computer users to use the product solely or at least primarily as a copyright-infringing mechanism. The Court, while not finally deciding that there was contributory infringement by the software developers in this case, found what it called “unmistakable” proof that an “unlawful objective” did exist.
Souter’s opinion cites three specific pieces of telling evidence. First, he noted that Grokster and StreamCast set out, in the beginning, to pick up where Napster had left off, satisfying a demand for those who explicitly wanted to download copyrighted works. Second, he said, there was no attempt to design any filtering tools to reduce the amount of infringement by end-users. And third, he found, the two companies made money by selling advertising space, then directing those ads to the screens of computers using their software. “The more their software is used, the more ads are sent out and the greater the advertising revenue,” according to the opinion. While cautiously suggesting that this evidence “would not justify an inference of unlawful intent,” Souter said its import “is clear” in the record of this case.
The opinion went on to stress that, beyond an unlawful intent on the part of the developer, copyright liability exists only if there also is factual proof that the software is used in the end to pirate copyrighted files. That exists in this case, Souter noted, on “a gigantic scale.” Thus, the Court overturned summary judgment in favor of the software developers, and sent the case back for a trial.
One notable legal point about the decision is that the Court’s most significant prior ruling on copyright and new technology remains intact, despite the urging of the copyright owners and, indeed, despite the urging of three members of the Court to reduce its protection for new technology that might be used for infringement. That precedent, of course, is Sony Corp. of America v. Universal City Studios, in 1984.
Souter’s opinion says explicitly that the Court would leave any review of Sony’s scope for another day. This means that new technology will not be illegal just because it is capable of being used for infringement. What makes the Internet file-sharing technology potentially illegal here, according to Souter, is evidence going beyond its basic characteristics or awareness of how it may be used, and revealing “statements or actions directed to promoting infringement.”
Justice Ruth Bader Ginsburg, joined by Chief Justice William H. Rehnquist and Justice Anthony M. Kennedy, said in a separate opinion that the Court should reinterpret the Sony decision more strictly, to insist on firmer evidence that software can and will be used for a significant amount of legal use. Justice Stephen G. Breyer, joined by Justices Sandra Day O’Connor and John Paul Stevens, answer that critique with a strong defense of Sony, as is. Thus, the two positions neutralize each other, and Sony stands, unrevised.
For some reason haloscan won’t let me trackback, so I’ll just do a manual one.
http://quante.blogspot.com/2005/06/mgm-v-grokster-report.html
Comment by Jared — June 27, 2005 @ 1:38 pm
Thanks for this analysis. That’s how I read it too. I also think it was important that Souter in the decision for the court clearly stated that “mere knowledge” of possible infringing use is not enough. I think this decision could hurt companies such as Kazaa and Grokster while helping open-source groups such as Shareaza and others who create these products for free without advertising them.
Comment by Rob — June 27, 2005 @ 1:39 pm
Thanks for the quick analysis. I am a 1L going into 2L who does research for a Professor and we waited for this decision before continuing on some Copyright Law work. I appreciate your insight to help me understand better.
Comment by Brian — June 27, 2005 @ 1:46 pm
Busy Day at the Supreme Court
A bunch of Supreme Court rulings came down today. I’m going to wait a few more hours to gather more…
Comment by The American Mind — June 27, 2005 @ 2:07 pm
Major ruling in digital copyright: Supreme Court weighs in on intent
In a major ruling on digital copyright, the United States Supreme Court issued a ruling on the Grokster case. The justices unanimously decided to send the case back to lower courts, finding that Grokster and Streamcast were deliberately and openly…
Comment by Smart Mobs — June 27, 2005 @ 2:28 pm
The Antagonist has written several times about the fundamental truths that underlie the p2p debate and the futility of the issuance of legal threats and every other tactic tried thus far.
The latest articles in this series, both of which
cover issues currently outside of the bounds of acceptable peer-to-peer and economic discussion are,
“Filesharing – The New Economy of Community” [http://antagonise.blogspot.com/2005/06/filesharing-new-economy-of-community.html ] and “Morpheus/Grokster Senate Ruling Explained” [http://antagonise.blogspot.com/2005/06/morpheusgrokster-senate-ruling.html]
Comment by The Antagonist — June 27, 2005 @ 3:50 pm
This actually will not hurt KaZaA and EDonkey, because those two programs are not based on one central server anymore, the links are all distributed from user to user all over the internet and are spread that way.
The only services that this is going to affect are Grokster and Streamcast, because they were marketed as a “illegal file-sharing software” and they were based on a central server that held the information about the IP’s of all the people sharing.
KaZaA and EDonkey have it in their agreements and EDonkey even has it on the main page of their client software that if you use their software for an infringing purpose, they do not support you and do not condone what you are doing.
Comment by Christopher — June 27, 2005 @ 4:22 pm
I made some similar points in my own blog posting, but went on to ask, and answer, what I see as the big question. Namely, what is the underlying strategy of the recording and movie industries? Why do they see it as a good thing to drive file sharers to ever more difficult to control technologies? See
http://blogs.mcs.gac.edu/index.php?p=81 for my answer.
Comment by Max Hailperin — June 27, 2005 @ 4:25 pm
Darn, the status quo remain the same and the hopes of file sharing destroying the cable business model may never materialize. ISP bill = pay for what you use, like your gas & electric bill.
I dont think this decision and the Broadband X decision does not bode well for competition and the US economy.
Comment by Chaser7016 — June 27, 2005 @ 4:55 pm
why dont they just sue google for indexing copywrited files. thats just when a p2p engine does. cept a p2p engine is for people not websites. and you can download illeagel files through google. its all bs
KOPIMI
Comment by flushingcomic — June 28, 2005 @ 2:22 am
Despite Demise of Real Property, Intellectual Property Doing Fine
As predicted in this space, the Supreme Court has ruled against Grokster, according to the AP. Says Justice Souter, “We hold that one who distributes a device with the object of promoting its use to infringe copyright, as shown by…
Comment by Likelihood of Confusion by Ron Coleman — June 28, 2005 @ 2:21 pm