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‘Golden Age of Free Music’ vs ‘Copying is Stealing’

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The Motion Picture Association of America (MPAA) has launched an advertising campaign using the slogan "copying is stealing" to convey to the public the message that digital copying (eg. over peer-to-peer (P2P) networks) is as serious and criminal as stealing a CD from a record shop or a DVD from a video shop.

This article considers "copyright theft" in the context of developing technology both in the UK and the US, and the intense battle of rights holders against technology suppliers and consumers, some of whom are harvesting the benefits of this "golden age of free music".

Pre-Digital Age

As long ago as the late 1970s, there were legal disputes in which owners of copyright in music/film, etc. claimed that suppliers of new technology were guilty of copyright infringement offences:

(i) In the late 1970s Ames Records allowed subscribers to hire records from it for a small rental charge. Copyright owners considered that this encouraged copyright infringement and affected revenues as it enabled subscribers to copy the records onto cassette tape. CBS took legal action against Ames Records for copyright infringement on the basis that Ames Records had "authorised" the copying by supplying the subscription service.

(ii) CBS also took legal action for copyright infringement against Amstrad in the 1980s on the basis that, by supplying cassette tape-to-tape recording equipment, Amstrad was "authorising" copyright infringement by users of the equipment.

CBS failed in both cases as the court found, in essence, that Ames Records and Amstrad could not control or prevent the use of the equipment whether or not this involved illegal copying and therefore they did not 'authorise' any copyright infringement.

(iii) In another 1980s US case (Sony vs Universal City Studios), the court agreed that video recorders would be used to copy television programmes. UCS claimed that Sony was liable for copyright infringement as it supplied the video recorders.

Sony was not liable for copyright infringement under US law because it did not have knowledge of copyright infringement and the court agreed with Sony that there were 'substantial non-infringing uses' for video recorders.

The Digital Age

The Digital Age has made copying easier. Music and video can be easily and quickly copied across a range of new media such as CDs, DVDs, MP3 players, hard drives and digital cameras.

A series of legal actions (mainly in the US) have shown that, while consumers exploit the opportunities and rights owners desperately try to stem the tide and regain the stranglehold on the market, the law struggles to satisfy either rights holder or consumer.

Rights holders claim that P2P has cost them billions of dollars in revenue. Only a tiny fraction has been recovered and rights holders are becoming increasingly aggressive in their litigation. Rights holders are now targeting consumers, ISPs, operators and even funders of file sharing systems with their large legal budgets/teams.

Napster

Napster is, or rather was, a P2P file-sharing software application which enables users to identify and download files (such as music and video) made available by other users.

The US courts shut down Napster by granting an injunction against it on the grounds that it was engaged in "contributory and vicarious copyright infringement" (mainly because the evidence showed that Napster was aware that its system was being used for copyright infringement and Napster supervised the copyright infringement and had a financial interest in it).

Napster has changed hands and the new operators have accepted defeat and are prepared to launch a download by subscription service which will give subscribers access to a massive music catalogue of around 500,000 titles. It is expected that royalties will be paid to rights holders in accordance with applicable licence agreements.

Grokster/StreamCast

The MPAA and the Recording Industry Association of America (RIAA) followed success against Napster with several further successes against other services but recent actions (April 2003) against Grokster and StreamCast failed on the basis that:

(i) the technology could be used for legitimate (as well as illegitimate) purposes,

(ii) the service suppliers could not control the use of the technology by the end user (whereas Napster had significantly more influence by maintaining a centralised index of files and helping to facilitate connections between users), and

(iii) users communicated across networks entirely outside the control of the service suppliers.

Bertelsmann

EMI, Universal and other music publishers are claiming billions of dollars in damages for copyright infringement against the German media giant Bertelsmann on the grounds that Bertelsmann helped fund Napster.

Bertelsmann has issued court proceedings to dismiss the claims and it claimed in a statement that US copyright law does not permit recovery of damages from a third-party funder. EMI, Universal, etc. responded by saying they intend to proceed with the claim.

Verizon

RIAA recently won a court order, under fast-track provisions of US copyright law, forcing an ISP (Verizon Communications) to disclose the identity of individual consumers who traded music files across P2P networks, including KaZaA.

RIAA has started a campaign of issuing hundreds of subpoenas against alleged copyright infringers.

Freenet

Freenet is a new-ish innovation described as "a decentralized network of file-sharing nodes tied together with strong encryption". Its operators claim that Freenet's security will allow users to share any kind of file without any risk that they may be identified by rights holders.

The US Supreme Court suggested recently in a case against another P2P operator, Aimster, that a file-swapping network that conceals its users' activities might fall foul of copyright law precisely because it is designed to conceal illegal acts.

Summary

The extent to which P2P operators are liable for copyright infringement in US law is not yet settled. It remains very much a case of 'watch this space'. If the Grokster and StreamCast decisions stand under appeal, this represents a significant setback to rights holders who would not be able to pursue the service suppliers in similar circumstances and may resort to claims against end users. This will be far more expensive in time and legal spend.

Meanwhile, rights holders will continue to pursue focused litigation campaigns, technological development will continue to affect all concerned and consumers will continue to "make the most of it while it lasts". ®

Copyright © 2003, Taylor Walton. All rights reserved.

Taylor Walton supplies a comprehensive range of commercial legal services. If you would like to discuss the content of this article or any other commercial matter, please email Tim Cook or call 01582 731161.

Related stories

Copying is Theft - and other legal myths
EMI sues Bertelsmann over Napster
Judge backs P2P file traders
Verizon loses RIAA piracy case
RIAA nails 1,000 music-lovers in 'new Prohibition' jihad

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