Digital Tweed: The Morning After Grokster

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Digital Tweed: The Morning After Grokster

7/21/2005

By Kenneth C. Green

The Supreme Court has spoken. In a 9-0 decision on June 27 concerning the case of MGM vs. Grokster, the US Supreme Court implicitly affirmed that copyright is a very good thing and explicitly stated that “one who distributes a device with the object of promoting its use to infringe copyright…is liable for the resulting acts of infringement by third parties.” In other words, if the primary or most common use of your firm’s product is to help individuals with copyright infringement, and if your firm promotes the product as a way to violate copyrights, then your firm can be held liable for the resulting acts of copyright violations by individuals who use your product.

D'es this billboard violate the letter or spirit of the Supreme Court's recent Grokster decision?

No question, this is a really big win for the music and movie industries. The Court’s decision overturns two lower court rulings that Grokster (www.grokster.com), StreamCast Networks (www.morpheus.com), and other companies that produce and distribute peer-to-peer (P2P) software were not liable if individuals used these products to violate copyright. Indeed, the Supreme Court felt that there was ample evidence that Grokster and StreamCast clearly intended to aid and abet copyright infringement, stating “the unlawful objective was unmistakable.” Writing for the Court, Justice David Souter’s opinion stated that there was “evidence of [copyright] infringement on a gigantic sale” and that the “probable scope of copyright infringement is staggering.”

Not surprisingly, there was a bit of a victory dance in the post-Grokster press releases from the entertainment industry. The Recording Industry Association of America (www.riaa.org), the trade group that has been aggressive in filing John D'e lawsuits for P2P copyright infringement, applauded the Supreme Court’s unanimous decision, stating that the Court “has addressed a significant threat to the US economy,” while “helping to empower the digital future for legitimate businesses—including legal file sharing networks— by holding accountable those who promote and profit by theft…. This decision lays the groundwork for the dawn of a new day…that will bring the entertainment and technology communities even closer together, with music fans reaping the rewards.” Concurrently, Dan Glickman, president of the Motion Picture Association of America ( www.mpaa.org) announced that the Court’s “unanimousruling is an historic victory for intellectual property in the digital age, and is good news for consumers, artists, innovation and lawful Internet businesses.”

Not to be outdone by the music and movie associations, StreamCast Networks vowed in a post-Grokster press release “to continue its fight for freedom to innovate.” The release proclaimed that “once all the evidence is put forward, we are confident that it will be proven that Morpheus did not, d'es not, and will not promote or encourage copyright infringement.” Additionally, the StreamCast statement proclaims that the “Supreme Court decision is Orwellian in that Hollywood—and the copyright and entertainment industries—now become the thought police.”