Court conflicted over file-swapping
on Mar 29, 2005 at 12:50 pm
The Supreme Court put on public display Tuesday two conflicting reactions to the apparently widespread practice of downloading copyrighted songs and movies from the Internet: a concern that software makers may be too enthusiastically encouraging the habit, and a concern that copyright law not be made so restrictive that it stifles new surges of technology creativity. The Court also showed some signs of unease with the adequacy in the Internet age of the central precedent at issue, the 1984 ruling in the Sony Betamax case.
In a one-hour hearing on the biggest Internet test case yet, Metro Goldwyn Mayer, et al., v. Grokster, et al. (docket 04-480), a number of Justices seemed attracted to the idea of letting copyright owners go after software developers on a theory that they are “actively inducing” theft of copyrighted works by computer users linked by that software.
Richard G. Taranto, a Washington lawyer for person-to-person, file-swapping software developers Grokster and SteamCast Networks, said copyright owners remained free to bring such an inducement claim and seek damages for it, if the case is sent back to District Court for a trial. (The case reached the Supreme Court after summary judgment in the District Court, affirmed by the Ninth Circuit.)
But Donald B. Verrilli, Jr., representing the movie studios, music recording studios and other owners of copyrighted works, countered that an “active inducement” remedy would be seriously deficient in putting a stop to the practice of file theft. He cautioned the Court not to affirm the Ninth Circuit on the key issue in the case — the meaning of the Sony Betamax decision as it defined secondary copyright infringement — because that would give infringers “a perpetual license to keep going forward, and not ever have to do anything to check the practice” of massive file-downloading.
What the P2P software designers want from the Court, Verrilli protested, is “a rule of immunity: all they have to do is speculate that there will be some non-infringing uses [of their product], and then you can go right on infringing.”
Several members of the Court — but especially Justices Antonin Scalia, Stephen G. Breyer and David H. Souter — seemed troubled about the potential impact of a tightening of copyright law on small inventors — “the guy in the garage,” as Souter put it.
Breyer wondered whether a lawyer for a developer — for example, the inventor of the iPod — could assure his client that he could continue to develop new products without fear of being held liable for the illegal uses to which the products might be used by some. Verrilli tried to provide assurances.
Scalia wondered aloud “how much time you get [as a designer] to bring up the lawful use so it outweighs the unlawful use,” and thus copyright liability is averted. Verrilli said inventors would not have “absolute certainty” that they could avoid liability.
Souter said: “The question is: how do we know in advance that we can give the inventor — that is, the developer — the confidence to go ahead? How do we avoid the foregone conclusion that the iPod developer is going to lose his shirt” in copyright damages?
Such developers would be protected, Verrilli suggested, unless they adopted “the business model” that he said Grokster and StreamCast Networks had adopted: creating a giant “infringing machine” with software that they not only know will be used to steal copyrighted works, but also had been engaging in activity to promote such unlawful use.
Verrilli’s argument placed the heaviest emphasis on this “business model” argument, premised on the claim that Grokster and StreamCast simply adapted the old Napster file-sharing software so that they could avoid copyright liability, even while profiting handsomely from it. But his emphasis upon that argument — strongly seconded by Acting Solicitor General Paul D. Clement, arguing for the federal government as amicus — led Justice Sandra Day O’Connor and others to suggest that the remedy should be an “active inducement” claim, rather than a secondary copyright infringement claim.
Justice Ruth Bader Ginsburg gave voice to a concern that seemed to be troubling a number of her colleagues, too — the proper legal standard for judging secondary infringement in the digital age. She and others several times asked the attorneys to spell out their interpretation of the Sony Betamax standard, and to articulate why they thought it might not be adequate. (The Sony standard has usually been understood as barring secondary copyright infringement if the developer has created a product that has the capacity for “substantial non-infringing uses” that were “commercially significant”.)
Ginsburg herself said the Sony decision was not so clear on the standard it was laying down, because of extensive discussion in that opinion beyond the formula on non-infringing uses.
The Court is expected to decide the case later this spring.
