ISP Safe Harbor

New Jersey Law Journal, July 23, 2001

Copyright 2001 American Lawyer Newspapers Group, Inc.
New Jersey Law Journal

July 23, 2001

LENGTH: 960 words

HEADLINE: Intellectual Property From to Napster: Navigating the Safe Harbor


*Congress has the chore of adapting copyright laws so they remain effective as technological advances change the face of commerce.
*This undertaking involves an intricate balance between the interests of authors to control and exploit their work product and society's competing interest in the free flow of ideas, information and commerce.
*As authors' and society's interests have changed over time, the copyright statutes have been amended over and over again. Congress has successfully adopted copyright laws for nearly 100 years, effectively responding to such major innovations as radio, television and video.
*Most recently, the Internet content, music and film industries have initiated litigation in order to secure copyright protection in the Internet environment. In particular, the digitization of copyrighted content, music and movies, along with the wide use of the Internet and the popularity of Internet file sharing, have resulted in significant litigation. The ease with which Internet users can copy and download digital files has resulted in both the Motion Picture Association of America and the Recording Industry Association of America losing the potential to earn significant amounts money from Internet users.
*In addition, Internet site operators and Internet service providers that facilitate the distribution of Internet content, music and films found themselves in the gray areas of copyright law when a court ruled against MP3. com. See UMG Recordings, Inc. v. MP3.Com, 92 F. Supp. 2d 349 (S.D. N.Y. 2000). This ruling had the effect of stifling Internet site and service provider activity due to the potential of copyright lawsuits.
*The Digital Millenium Copyright Act was enacted to ensure that copyrighted content would continue to be protected by copyright law in the digital environment, while simultaneously allowing the flexibility necessary for Internet technologies and businesses to flourish by making copyright content available.
*The DMCA was tested by both the MPAA and the RIAA. The MPAA challenged the unauthorized copying and distribution of copyrighted movies on digital versatile disks over the Internet. The RIAA contested the unauthorized downloading of compressed music files known as MP3s.
*In both instances, the potential piracy troubles result from the digital nature of the intellectual property and the fact that digital content can be copied and shared so easily. In fact, CDs and MP3 files do not contain encryption technology to protect against the unauthorized copying of music content and the encryption that is used by DVDs did not provide appropriate protection.
*The MPAA was successful in Universal City Studios, Inc. v. Reimerdes, 111 F. Supp. 2d 294 (S.D.N.Y. 2000), in which the court enjoined a hacker Web site from the posting and linking of computer code used to descramble DVD encryption technology protection.
*To date, the RIAA has not been as successful as the MPAA. The RIAA filed a suit in the U.S. District Court for Northern California against Napster, Inc., an Internet firm that facilitates peer-to-peer file sharing, enabling its users to download MP3 files at no cost.
*The RIAA members alleged that Napster was liable for contributory copyright infringement and vicariously liable for the direct copyright infringement of its users. Napster filed a motion for summary adjudication under 17 U.S.C. ' 512(a), the safe-harbor provision of the DMCA. Napster argued that the plaintiffs were not entitled to monetary damages or injunctive relief except for narrow injunctions against individual copyright infringers.
*The RIAA argued that '512(a) did not apply since the purportedly infringing material did not go "through" the Napster servers, but was transmitted directly between users' machines. The RIAA also argued that each section of the DMCA must be analyzed independently and that the more narrow subsection 516(d), which refers to information location tools such as search engines, is more applicable to Napster.
*The court ultimately agreed with the RIAA, rejecting Napster's safe-harbor argument and ruled that Napster failed to rein in copyright infringement in accordance with '512(i). The court found on May 12, 2000, that Napster did not meet the requirements of the DMCA. See A & M Recordings, Inc. v. Napster, Inc., 2000 WL 573136 (N.D. Cal. May 12, 2000).
*On July 26, 2000, the District Court granted RIAA's motion for a preliminarily injunction against Napster "engaging in or assisting others in copying, downloading, uploading, transmitting, or distributing copyrighted music without the express permission of the rights owner" and ordered Napster to comply by July 28, 2000. See A & M Recordings, Inc. v. Napster, Inc., 114 F. Supp. 2d 896 (N.D. Cal. 2000).
*The Ninth Circuit Court of Appeals on July 28, 2000, stayed the lower court's injunction that would have shut down Napster. See Nos. 00-16401/16403, 2001 WL 1055915 (9th Cir. Feb. 12, 2001).
*A & M Records, Inc. v. Napster, Inc., is still in progress. See No. 16401, 2001 WL 115033 (9th Cir. Feb 12, 2001). Currently, Napster is permitted to stay in business until such time that the Ninth Circuit agrees with the District Court that the RIAA presented a prima facie case that Napster users committed direct copyright infringement. It must be noted that Napster may ultimately be held liable for contributory and vicarious copyright infringement.

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