Supreme Court Said ‘Likely As Not’ to Revise Betamax
So much has changed since the Supreme Court’s Betamax decision that the “exact contours [of copyright law] are very much in play” regarding P2P networks, said e-commerce and intellectual property attorney James Halpert in a phone conference Fri. hosted by the Information Technology Assn. of America (ITAA).
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The decision by 9th U.S. Appeals Court, San Francisco, not to hold P2P company Grokster liable for copyright infringement on its network, and the Supreme Court’s Dec. decision to hear the appeal, “has produced a firestorm of activity” by copyright owners, P2P network companies and their industry and academic allies, Halpert said.
The Grokster case is nothing like the original Betamax decision, Halpert said. Sony’s recorder was mainly intended to time-shift programming for later home viewing. Halpert said Grokster is “hard to love” because it “changed its business model to get outside” the feature that brought down Napster legally -- namely a central server under the company’s control -- and encouraged users to share files regardless of copyright. The Solicitor Gen.’s brief against Grokster is another sign that the Court will impose some liability for P2P infringement on parties other than users, Halpert said.
Halpert gave suggestions for companies worried about liability for infringement enabled by their networks or software. He told them to never encourage users to illegally trade files, to take care how instructive and descriptive documents are written, and to avoid product design, such as viral distribution, that suggests reliance on infringement. Because the copyright law was written before the P2P “explosion,” 3rd-party liability is limited, Halpert said. Service providers in a position to take down infringing material promptly when discovered, ban repeat infringers and accept protection standards from copyright owners will be safe, Halpert said. But he warned “the takedown is not all that useful” for copyright owners because most P2P networks don’t use their own servers to store content.
Several conditions can make the legal requirements murky, Halpert said. Service providers that contract with other companies for content that may infringe could be liable based on their knowledge of infringement and laxity in removing it when they can, he said. Automatic system caching and “incidental copying” to make content available more quickly, even when it infringes, isn’t a danger. Halpert distinguished between service providers’ receiving a specific fee “directly attributable” to enabling infringing behavior, and charging a flat fee for all sorts of service not related to infringement.