I kinda thaught this myself when I was reading the court's decision. This is an interesting read.
http://www.usatoday.com/tech/columnist/andrewkantor/2005-07-01-grokster-decision_x.htmDespite reports, Grokster decision is a win for file sharing
Monday's Grokster decision by the Supreme Court is a win for file sharing. In fact, it's a pretty big win, and it's a loss for the entertainment industry.
Yes, you read that right. Most of the news reports ("Big win for Hollywood in file-sharing case!") were simply wrong, written from press releases and too focused on the fact that Grokster lost, by writers who didn't read the opinion.
If they had, they would have realized that Grokster's and StreamCast's loss was file-sharing's gain.
The Grokster case, as it's come to be known, pitted the entertainment industry against two companies that make file-sharing software: Grokster and StreamCast. The entertainment folks claimed that Grokster should be liable for damages because it not only allowed users to share music illegally, it encouraged it.
Grokster and StreamCast countered that, thanks to the Court's 1984 "Betamax" decision, they were protected from liability. Betamax said that VCR makers could not be held responsible even if VCR owners used the machines illegally.
This week, the Supreme Court ruled that Grokster and StreamCast cannot claim the same protection, because — and the "because" is the part that most people seem to have missed — they actively encouraged piracy.
That's crucial. The Court did not say that file-sharing itself was a problem. The way Grokster and StreamCast marketed it was.
"They (pointed) out that Grokster had done an number of specific things to encourage copyright infringement," said Rep. Rick Boucher, my go-to guy when it comes to tech issues and Washington.
So the Court's decision was, oversimplified: Grokster and StreamCast bad, file-sharing OK.
Of course, that's not how Hollywood and the recording industry are playing it.
The Hollywood spin
"We won big," said Hilary Rosen, former CEO of the RIAA. But she's too busy thinking about Grokster the company losing to realize that Grokster the idea didn't lose.
Sorry, Hilary. You really ought to read the opinion first.
Here's what it said in a nutshell:
1. Grokster and StreamCast didn't just provide technology that could be used for piracy; they actively encouraged it. "The record is replete with evidence that from the moment Grokster and StreamCast began to distribute their free software, each one clearly voiced the objective that recipients use it to download copyrighted works, and each took active steps to encourage infringement."
2. Because of that, they can't claim protection from the Betamax decision. "Nothing in (the Betamax decision) requires courts to ignore evidence of intent to promote infringement if such evidence exists," held the Court.
This is why the headlines read, 'File-sharing companies can be sued.' Sure, they can be, but whoever sues them will have to prove they encouraged piracy.
See, unwritten but obvious from the opinion are two ideas:
1. File-sharing software itself is not illegal (although it can obviously be used illegally).
2. Companies that make digital technology are not responsible for their use unless, like Grokster and StreamCast, there is "Evidence of active steps taken to encourage direct infringement."
In other words, the Court said that Grokster and StreamCast did wrong not by allowing file-sharing, but because they promoted its unlawful use.
Trouble for them, but good news for BitTorrent, Gnutella, and other companies and open-source projects that don't encourage piracy.
You win some, you lose some
The ruling was obviously not a complete win for file-sharing — not by a long shot. These companies had hoped to get the same kind of immunity from lawsuits that VCR makers enjoy thanks to the Betamax decision. They didn't.
But they do get a lot of protection, because in order to be liable they have to actively encourage piracy. Simply making the software doesn't cut it.
Not being a lawyer, I can't tell you what would be considered "active steps to encourage infringement" or what kinds of disclaimers, blockers, or warnings would be enough to prove you aren't encouraging it. Still, it can't be that hard.
I suspect you'll start to see more click-through boxes on software — "By clicking this button I agree not to share copyrighted content over the such-and-such network."
So the entertainment industry won a small victory; they have the right to sue. But, as my father says, "You can sue anyone." Winning, though, will be a very difficult matter.
As Boucher put it, "While the Grokster file-sharing service may be in some jeopardy, another file-sharing service that has not done what Grokster did … would have no problem."
As Gigi Sohn, president of Public Knowledge, a Washington, D.C., lobbying group that focuses on digital rights told me, "You would be hard pressed to read this case to say that innovators will have to design their tech differently. I think the court was pretty clear in stating that the technological design is not a factor in determining inducement."
So as long as file-sharing software makers don't encourage piracy, they can stay out of trouble. The MPAA and RIAA will have to resort to suing individuals.
Which they obviously have no problem doing.
Andrew Kantor is a technology writer, pundit, and know-it-all who covers technology for the Roanoke Times. He's also a former editor for PC Magazine and Internet World. Read more of his work at kantor.com. His column appears Fridays on USATODAY.com.
