A Briefing On Public Policy Issues Affecting Civil Liberties Online from The Center For Democracy and Technology
(1) CDT, Tech Groups Urge High Court to Protect Internet Innovation
(2) Background: Grokster Case Addresses Key Copyright Rulings
(3) Breathing Room Needed for New Technology, While Inquiry Continues
(4) California Bill Indicates Continued Fight on Tech Liability
CDT and leading technology groups filed a friend-of-the-court brief before the U.S. Supreme Court this week in the case of MGM v. Grokster, a lawsuit against Grokster and other file-sharing companies for copyright infringement. CDT's brief urges the Court to uphold its long-standing "Sony Betamax" protections for technology developers, which have been essential to the development of a democratic and open Internet.
CDT strongly believes that if the Internet is to flourish, the creators of music, movies, and other valuable content must feel comfortable distributing that content online. At the same time, legal protections for copyright must not jeopardize the openness and innovation that have made the Internet an engine of free expression and commerce.
Filed with groups representing Apple, Microsoft, Yahoo, Google, AOL, and others, CDT's brief explains to the Court why legal protections for the design and distribution of new technologies, even if some can misuse them, have been essential to the development of important consumer products like the iPod, instant messaging, and the computer itself. At the same time, the brief argues that courts should apply existing legal standards to explore whether file-sharing companies might be liable for other egregious conduct that materially contributes to copyright infringement.
The Grokster case is part of a continuing tug of war in the debate over how to deal with new threats to copyright in the digital age, while allowing "breathing room" for valuable new technologies that might also be misused for infringement. A major test of this balance in copyright law will come with the Supreme Court's decision in Grokster, expected by June. This same issue was put before Congress in the "Induce Act", a bill that would have created new liability for peer-to-peer providers, and which may be considered again this year. State legislatures are also taking up the issue, with a bill introduced in California this month that would place troubling new design mandates on tech companies.
More information about the CDT brief and these issues generally is available at:
At issue in the Grokster case is the question of when one party can be held liable for copyright infringements committed by others, an extraordinary form of liability since the penalties for infringement can be high. Such "secondary liability" is particularly difficult to apply to those who distribute products that can be used both lawfully and for infringement, such as VCRs or computers.
Twenty years ago, in its landmark Sony v. Universal City Studios opinion, the Supreme Court held that there should be no secondary liability for those who merely create and distribute a technology that "is capable of substantial or commercially significant uses." That case upheld the legality of video cassette recorders. Although it was claimed that VCRs were a threat to the motion picture industry, the Court held that they had valuable non-infringing uses.
This winter that same principle is before the Supreme Court. In this case, it is undisputed that the Grokster and Morpheus peer-to-peer services are used by millions to illegally infringe copyrights? but that at least 10% of the transfers on those services are lawful. Based in part on the finding that there were substantial non-infringing uses of Grokster, last year the Ninth Circuit Court of Appeals held that Grokster was not responsible for infringement by users of its software.
At the same time, the Supreme Court is considering a decision by the Seventh Circuit in a ruling against peer-to-peer service Aimster. The court held that technology providers could be held responsible for infringing uses of their products unless they showed that it would be "disproportionately costly" to prevent infringement--even if that meant redesigning their technology.
CDT believes that the broad public interest in an open and democratic communications media demands breathing room for valuable new technologies to develop, even if they may have some infringing uses. As argued in the CDT and tech group brief, the Sony standard for liability has been a critical shield for the developers of new technology, from the iPod to instant messaging to the computer itself, all of which might also be used for infringement. These products might never have been developed, and the democratic potential of the Internet might never be realized, without the protections of Sony.
The brief presents a shared technology community perspective on the importance of balance in digital copyright law. As the brief argues, "Amici do not condone - indeed, they strongly condemn - the use of peer-to-peer technologies to violate copyright law. Neither, however, do amici support the substantial broadening of the standards for secondary liability that petitioners urge this Court to adopt. Amici submit this brief to apprise the Court of the dangers to technological innovation, free expression, and democratic values online that are posed by petitioners' position."
The CDT and tech community brief also urges the court to reject the broad form of liability set forth in Aimster. That rule would subject technology designers to expensive litigation difficult to end without detailed court inquiries into why and how design decisions were made. The Seventh Circuit's vague standard would require courts to second guess design decisions and would chill the development of important communications tools. The brief argues: "The Aimster approach would literally open the floodgates of litigation. The superior framework is the one Sony established, which has proved effective over the course of twenty years of unprecedented technological innovation."
At the same time, this week's brief was filed in support of neither party. It explains that the Ninth Circuit erred in the way it applied the Sony test, sets forth a clearer and more sustainable formulation of that test, and argues that the case should continue forward to examine other issues. While Sony protects the distribution of technology with substantial non-infringing uses, it does not immunize other egregious conduct that might amount to a material contribution to the infringement of others. For that reason, the brief argues that the Court should remand the case back to the lower courts for further consideration of these issues.
In doing so, the brief recommends a narrow remand emphasizing the difference between technology and behavior: "Grokster's conduct in this case may well give rise to liability. Although the Sony defense shields technology vendors' design, manufacture, distribution, general advertising, and routine support activities from secondary liability, that safe harbor does not extend to a vendor's other conduct. Rather, such other conduct is evaluated according to traditional principles of secondary liability, with remedies for any liability narrowly tailored to address the infringing acts that the vendor's conduct encouraged."
CDT expects that the secondary liability issues raised in the Grokster case--and last year in the debate over the Induce Act--will continue to be an important focus in the copyright debate. While CDT is supportive of efforts to protect copyright by focusing on bad actors rather than banning specific technologies, poorly crafted and overly broad liability could seriously harm free expression and innovation online.
A bill recently introduced in California, SB 96, provides an example of such a dangerous expansion of secondary liability. The bill would fine, or imprison for up to one year, any person who distributes software that allows users to connect to networks that can share files, unless that person takes "reasonable care" to ensure that the software is not used illegally. Such a bill would make the distributors of web browsers, instant messaging software, and many valuable peer-to-peer products the target of crippling lawsuits. Meeting a design mandate to stop illegal uses of software could well threaten free speech, privacy, and other important values online.
CDT remains committed to finding balanced solutions in the copyright debate that protect intellectual property, while remaining vigilant against approaches that would damage the open, decentralized Internet. We continue to believe that attractive new digital distribution of content, enforcement of existing copyright laws, and broad public education ? rather than design mandates ? will be the most effective way to protect artists in the digital age while preserving the promise of the Internet.