Arista Records LLC et al v. Lime Wire LLC et al

Filing 547

DECLARATION of Susan Traub Boyd in Support re: 533 MOTION in Limine to Preclude Specified Categories of Evidence and Argument.. Document filed by Arista Music, fka BMG Music, Arista Records LLC, Atlantic Recording Corporation, Capitol Records, Inc., Elektra Entertainment Group Inc., Interscope Records, Laface Records LLC, Motown Record Company, L.P., Priority Records LLC, Sony Music Entertainment, fka Sony BMG Music Entertainment, UMG Recordings, Inc., Virgin Records America, Inc., Warner Bros. Records Inc.. (Attachments: # 1 Exhibit 1, # 2 Exhibit 2, # 3 Exhibit 3, # 4 Exhibit 4, # 5 Exhibit 5, # 6 Exhibit 6, # 7 Exhibit 7, # 8 Exhibit 8, # 9 Exhibit 9, # 10 Exhibit 10, # 11 Exhibit 11, # 12 Exhibit 12, # 13 Exhibit 13, # 14 Exhibit 14, # 15 Exhibit 15, # 16 Exhibit 16, # 17 Exhibit 17, # 18 Exhibit 18)(Boyd, Susan)

Arista Records LLC et al v. Lime Wire LLC et al

Doc. 547 Att. 3

EXHIBIT 3

Dockets.Justia.com

Peer-to-Pear

Pile Sharing and Copyright

Law

after

Napstar

Page

of 11

P2Panalystcorn
this article appears with pennission

of the author

Peer-to-Peer File Sharing
after

and Copyright Law

Napster

by Fred von Lohinann

Attorney-at-Law

and Visiting Rosearther

Bateky

Center

for Law

Tccbnolagy

What
As
copyright sharing

this is
Napster

and who should read
has already

it
is

the

saga illustrates
fight

the future of peer-to-peer file-abating

entwined

Ibr better

or

wont

with
file-

law The
like

legal

broken out with copyright owners targeting not only the makers of
thai

clients

Napstcr

and Scour but also companies which provides

provide

products

that

rely on or add value to

public

P2P

networks

such as MP3Board.com

web-based

search interface

for the Onutella

network

The

fight

has

only just begun
to be in place

If these early skirmishes yield any lesson tbr timne preibrably
file

legal strategy

needs

early

at

the beginning

of development developer

rather than bolted investor

P2P developers on

its that
at

the

end

As

result

if you

are interested in peer-to-peer platform tools

sharing

whcihcr as
to

or provider of ancillary

services

such

as search services

or security its fime

bone up on some copyright law basics

This piece
sharing

is

meant as
It

general

explanation

of the U.S copyright law principles most relevant

to

P2P

file-

technologies

is

aimed primarily at

Deelopers of
client

core

P2P

tile-shaving

technology

such as the underlying protocols

platlbrm

tools

and specific

implementations
that

Developers of ancillary services

depend upon or add value to P2P

file-sharing

networks

such

as providers of

httpw.gding.com/P2Panalyst/VonLohmann-arficle.httnl

7/120.008

Peer-to-Peer

File

Sharing

and Copyright

Law

after

Napster

Page

of

11

search

security seeking

meradata
to

aggregation

and

other services eopsntLht

tilveswrs

evaluate

the potential

oaks

oociated

with the

various

ventures

listed

above

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that

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principles that

does
this

not address any discussion does

issues lit

attempt or un
lair

to examine other legal

might

apply

to

P2I filesharing
adviee--please

including
iseuss

patent

trademark
individual

trade secret with

competition Nothing contained
attorney

herein

constitutes

legal

your

situation

your own

Copyright Basics and the Intersection with P2P
Filesharing
Copyright
of
in lass

applies ta

virtually

evely
as

lbrni

olcxprcssion

thai

can tape

be captured
hard drive

or

to

use the copyright

term

art

fixed

in

tangible

medium

such

on paper film magnetic
all

optical

media

or even merely Copyright plus 70

Songs hooks photographs software and movies are Protection begins from the moment that the expression is fixed
vcars

RAM

familiar

and

works examples of copyrighted continues for the lifetime of the author

During
right to

this

penod

copyright and

law reserves
perform

eertuin

rights

exclusively
for

to

the
if

owner

of the work song and
right to

including recorded

the
it

reproduce

distribute

publicly

the

work So
work
local

example

you wrote
the

on

your
file

computer
distribute
it

you would own
to

the

resulting

copyrigoted
in

and

only you would have hall If anyone
activity else

make

copies of the without

the

public

or sing the song

your

concert

did any of these things fair

your perrrussion

she would be infringing your copyright exceptions
to

unless the

qualified

as

use

or

fell

into

one

ot

the other statutory

copyright

owners

exclusive

rights

The

nature

of digital

file-sharing

technology

inevitably

implicates copyright

law

First since every the tiles being
to

digital

file

is

tixed

for purposes

of copyright

law whether

on

hard drive

Ci or
To

merely

in

RAM

shared
in

generally

qualify as copyrighted distribution
act tnti

works Second
possibly copyrighted
Letluires

the transmission of

tile

from one person of copyright

another

results

reproduction includes the

and

public perthrmance

in the world

law public

performance tiom the

of transmitting

work

to

the

public
and

copyright

lawyer every reproduction seem suspicious

distribution
IlitsOt

public performance

an explanation

thus tilesharing systcms

The endusers direct infringement
For the individuals
.ini

who
arc

are sharing by
are the

tiles

the question copyright

becomes whether
or otherwise
are

all

of these reproductions under enpyright

distributions law

public

1wrformanct

authorized

the

owner

perniittecl

as fair
copyright

Use
nwner
arc

br example

So

it

the liles you

sharing

wth

your

ftiends

videos

of your

vacation

you

are the

and have presumably authorized

reproduction

distribution

and

performance Microsoft

of the videos
Office

However

lvou
the the

sharing

MP3

of Metalhicas

greatest In that

hits or disc images olihe

latest

2000

installation the

CD
the

issue

becomes more complicated
of copyright infringement

case assuming depend whether ourc
%\hat

that

the copy right owner

has not

authoirized

activity
to

question c.p
right

will If

you can

qualify Ihr any of the limited exceptions
aall

owners

exclusive

rights

not

copyright lawyer rights

direct

infriugeryou have

directly

io1ated

one or more of the copyright owners exclusive

http//www.gtamarketingcom/P2Panalyst/VonLohmann-article.html

7/12/2008

Peer-to-Peer

File Sharing

and Copyright

Law

after

Napster

Page

of

11

he

P2P
1U1

tool ic4
cet

maker contributory and vicarious
Ti-us

infringement
fiicshnring
toulsY

WFPJE

hac

to

do

\5 iu

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develon
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tod

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ci

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li 1LUt
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cl

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cih1 ho ho
the iritringng actn ity
to

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ieach

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airect

infringer

10

inose

wOo were

only incsirectiy

many otner areas of eomg to commit crime Icr example if swapnieet
swapmect owner
can
b.c

the law think of the copyright

wheeI

man in
with

stick

up

or

supplying

gun
fix

someone you Icno
of another

is

law

will

sometimes hold one indivzdual accountable
to

the actions

So
the

owner
liable

rents for

space

endor

the

know ledge

that

the vendor sells counterfeit

CDs

held

mh-ngement

alongside

the vendor

Under infringement
thai will

copyright

law

this

indirect

or

secondary
in

liability

can

take two distinct theory

forms contributory owner
infringer
it

and vicarious
direct

infringement
infringement widely-used
are

order to prevail place
In

under

either

the copyright
direct

must

first

show

some

underlying

has taken

other

words

there

must be

before
virtual

anyone

be indirectly
that

liable In

public peertopeer
in infringing that to

filesharing
activity

environment
specific

however

is

certainty prevent

at least

some endusers

engaged
of

unless

technical

measures are taken

to

this like

permitting
labels

only the sharing

tiles

have sue

been

cryptographically
fhr

marked was not

as

authorized
fbr

When
to

the major record large

and music publishers decided
users

Napster

example

it

difficult

them

locate

number

or Napstcr

who were

sharing

copyrighted

music without

authorization

Contributory

Infringement
similar

Contributory

infringement

is

to

aidin.g

and
the

abetting
courts

liability it

one who

knowingly

contributes

to

anothers
infringing

in

fringeinent

may bc held accountable
causes
in

Or
on

as

have put

one who
theory

with knowledge

of

the liable

activity

induces

or materially contributes to the infringing conduct contributory infringement

of another copyright

may beheld

as

contributory each

infringer

So

order to Prevail

owner must prove

of the following

elements

Direct

Infringement ledge The

There has been
contributory
that

direct infringer

infringement

by someone
underlying
direct

Knon

accused
either

knew

of the

infringement

This

element

can be he

satisfied

by sho-ving
should

the contributory
all

infringer

actually

knew At

about

the infringing activity
the

or that

reasonably infringer

have iwonn given
specific

the

facts

and

circumstances

must have some
for

information
itself
is

about

infringing activity

minimum however the mere fact that the

contributory
is

system

capable

of being used

infringement by

not enough
infringer

Material Contribution
underlying possible can
direct

The

accused

contributory

induced and

caused
that

or materially contributed Inake the direct

to

the

infringement

Merely providing

the sile

facilities

infringement

be

enough

Vicarious Infringement
icarious infi-ingement detions
is

derived
will
Ite

from the same
liable for

legal

principle

that

holds ifhe

an

employer responsible and
ability to

for

the

of

its

employees
activit and

person
also

vicarious infringement
interest in

has the right
in

supervise vicarious

the infringing

has

direct

financial

such

acti ities

Thus

order to prevail

on

tiingement

theory

copyright

owner

mush prove
direct

each

of the

following

Direct

Infringement

There has been

in

IIingencnt

by someone

Right and Ability
the
that

to

Control

The

accused

vicarious

infringer

had high
to the

the

right

and

ability-

to

control the

or super

ise

underlying the ability

dircot to

infrmnuement
usel

his element does
or block

nt ct

hurdle

For example

Napster

court found

tcnninatc

accounts

user access

system was

enough

to

constitute

control

httpl/wwwgtamarketingcomlP2PanalystNonLohrnann-artiele.html

7/12/2008

Peer-to-Peer

File

Sharing

and Copyright

Law

after

Napster

Page

of

11

Direct

Financial
direct

Benefit

The

accused
In

vicarious
tIns

infringer

derived

direct

financial
riot

benefit
that

from

the benefit

underixing especially

infringement
or

applying

rule

however seems
irllrIIt

the courts have
10

insisted

the

be

direct
use

finaneialalmost
exisis

an

benefit

he

enough

For example
as

the Napster
fbr

court found and the

tiiianctil

benelit base
in

where

the the

a\adabihtv

iaaieriai In

acs

onw

eusemers

ncing

tuni mjki-

miflnv

ao

ci

nive4ors

should

be

noted

that

the nature

of vicarious
fact are that

infringer
is

cut nol

liability

creates

strong
in

incentive
iiiugernenl

to

monitor

the conduct person can

01

your users
vicarious
icr

stems
infringer

from he
if

knowledge

required lUr vicarious
activity of

liability

he

even

they

completely
their

unaware of nf ringing you remain
to the ignot

As

result if you exercise
at

control

ocr
words
of

users and derive

benefit

front to

activities

ant

their

conduct

your own

risk In the detectable

of the Napster court
infringement
for

the

tight

police must he

exercised

fullest

extent

Turning

blind eye to

acts

the sake

of profit

gives rise to liability

indirect Liability
The
seivice Napster
that

and P2P Systems the Napster Case
the
first

case

represents
plaintiffs that

application
that

of these

indirect

liability or

theories

to

peertopeer

filesharing

ease the

admitted Napster
is

Napster
thr

did not itself and

make

distribute

any

or their copyrighted
In
its

works instead opmion
the

they argued

liable

contributory

vicarious infringement defenses

February

12 2001

Ninth

Circuit agreed

rejecting

each

of Napsters proposed

Turning

first

to

contributory

infringement

the

Ninth

Circuit

upheld

the lower

courts findings

Direct

Infringement

At

least

some

Napster

users are direct

infringers because

the

distributed

and

reproduced

copyrighied

music without
Napster

authorization
actual

Knowledge
of

had
files

kno\\

ledge ofullinging activity

based

on

internal

company
executives

einails

and

the

list

2000

infringing based

provided

by the

IAA

Moreover
and

Napster

should
habits

have known of of
its

the

infringing the appearance

activity

on the recording song
titles

industry experience promotional

downloading

and

of wellknown

in certain

screen shots used by Napster and
facilities for

Material Contribution

Napster

provided

the site

the directly

infringing conduct

of

its

users

The Ninth
Direct

Circuit

also

endorsed

the

lower

courts

vicarious

infringement

analysis

Infringement

At

least

some

Napster

users are direct

infiingers

because

they distributed

and reproduced

copyri ghteci

music vi thout authorization
Napster
ability

Right

and Ability to Control
block Napstcr

has the ability
to

to

control

the infringing activity

of

its

users

because

it

retains the right to Financial
activit

users

access

its

system
from
the infringing activities
is

Benefit
as

derived
for

financial

benelit

of its users because from
the size

this

acted

dran

customers and

portion of Napsters value

derived

ofts user base

The
ihnits

Ninth

Circuit concluded

hon ever
the

that

the lower

court had

not adequately
In

considered

the

technological
its

oft he

Napstcr Ninth notice

system when

crafting

preliminary guiding
that

injunction

ordering the district

court to revise

injunction
iticr till

the

Circuit spelled out some

principles
is

First in order to prevent
sharecI

contributory

infringement Napster
the also

receiving

from

copyright steps to

owner

work

being

on

its

system without

authorization
will

have

to

take reasonable
this

prevent

farther

distribution

of the

work Although

the particulars
to
its

lower court
require
ot that

almost

certainly will require that

Napster

implement

more

sophisticated

Napster implenient filename filtering based on MP3 IL tags \lDS filtering

central

be up to index It may

hashes

acoustic

fingerprints

other

mctadata Second
the Ninth
the Circuit

in

order

tc

prevent

vicarious iiinngenient oithe

declared of this

that

Napster.
will

.bears

the htnxien

ooiieina

its

system

within

the limits

system Again

particulars

command

be

determined

by

http//www.gtamarketing.eom/P2Panalyst/Vonhohmann-article.html

7/12/2008

Peer-to-Peer

File Sharing

and Copyright

Law

after

Napster

Page

of 11

the lower court

Nevertheless Napster

this xvii

almost
its

certainly

require
will

some

pro-active

monitoring
to

activity

by Napster
to

iucc
kccp
iat

in

the

courts

view
clv

controls

users

Napstcr of
001
its

likely

be required

take reasonable

measures
xviIi

tabs on wIat

those users arc up to within monitor cootinac
ceniral

the hounds
to

system songs

architecture

At
are

minimum this
not authorized

recluire

Napxtcr
Ji-0 reqi

proacus
FIlO

index

weed

ans

mat

it

knows

for

sharing

it

that

\apser

tC3i1i1ak

UtF5

didi

gitcd works without

authorization

Potential Defenses Against Contributory
Liability

and Vicarious

No

Direct Infringer All of
As
discussed can

My

Users are Innocent Fair Users
there

above

if

there

is

no

direct

infringement
hi the

can
are

be

no

indirect

liability

topeer developer
uris

plausibly

claim that
to

no users

network

sharing

copyrighted

Consequently if peerworks without authorization
this

would

he

complete defense
to

an
given

contributory
the

or vicarious infringement

claims Unfortunately
and
the

may

be
to

extremcly

difficult

demonstrate
if

decentralized

nature of most P2P networks
is

wide

variety

of uses

which they
statutory

may

he put Even
to

file
it

sharing
will

by some users
difficult to

privileged
that

under

the fair
fails

use

doctrine such an
file

or another exception

exception

copyright

be very

show

every

user

within

Nevertheless viable defense

in certain

specialized networks

that

permit the sharing

of only secure

authorized

types

this

maybe

Capable
Although
ins olved
in

of substantial
contributory and

noninfringing
can

uses
sweep broadly catching
has defined an

vicarious iniringcmcnt

even those only
this

indirectly

the copyright

infringement

of others

the

Supreme ourt
found
that

outer limit to

reach in

case the

involving

the

Sony
of

Betamax
device
that

VCR
is

the Supreme

Court

contributory

infringement

liability

could

not reach

manufacturer

capable

of

substantial

noninfringing

usc
that

Universal
lool

City Studios infringement

and Disney were on one

side

of this case arguing
its

the Sony Betamax of
its

VCR

was and

of copyright

On

the other side

xvere
its

Sony

advertising

agent

several

retail

distributors 5-4
if

one individual
decision
that

VCR

user The case ultimately made
in

ay

to

the

Supreme

Court which ultimately issued
liability substantial

proceeded
engaged

two
in

paifls

First the Court infringement

held that

there could

he no contributory was capable
of

even

some
uses

VCR use

users were
In the

copyright

so long as the device
that the

noninfringing

second part

of

its

opinion the Court
telcv ision

found by

VCR

was capable

of several

such

noninfrmgmg

ha ludin.Q

the

thncshifting

of

broadcasts

home vicwcrs
of the

nfortunatcly

the recent Ninth Circuit decision court found and derive service
is

in the this

Napster

ease has
n.ot

dramatically
to

reduced

the

scope

Ectamax defense
Accordingly ubstantial
only applies
pievctit irreles fhe if

Firsi the Napstcr

that

defense
benefit

does

apply

vicarious

infringement the existence the Betamax point

liability

you have control over

financial irrelevant

from
tile

direct

infringement
that that

of
defense
to act to

noninfringing
until specific

uses

for

your

Second
activity thc

court concluded

intormation
Skill

identifying infringing liahihty and

has

been received
of substantial

At

failure

inirmging

activjty

give risc to

existence

noninfringing

uscs becomes

ant
Ninth ircuits
otthc Betarnax detcnsc has
least

interpretation
tile

at

two important implications
least in
tile

for

P2P
court will

aevelop

cii

First

it

underscores hearing and about

threat

of vicarious infringement liabilityat
noninfringing
as

Ninth

Circuit
in

ot he interested ccordi
ngl

in

your

substantial

uses

if

you

are

accused

of vicarious

ftingement
will

control

direct

financial

benefit

descnbcct

above

should

he given

wide berth Tins

like

hffp//www.gtamarketing.eom/P2PanaiystRJoflhiOhmanfl-artiCle.html

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Peer-to-Peer

File Sharing

and Copyright

Law

after

Napster

Page

of

11

reduce

the attractiveness

of business models

built

on an on-going
user activity

seiiice

or

communitybuilding
users and
completely direct

model
value

to

Ue

extent

that

these models allow large user base
mrsoiht

the provider to conuol

i.e. terminate or block
attractiveness

create

atirneting

At the same
as

time

it

3g soltwae

thk

amight

rminimizc

may ti vemiors

increase

the

of selling

decentralized
financial

conLul

oer

and continuing

meuL

nan
Second

nIrmnjag uses

with

respect

to

contributory and desist

infringement
letters

the

Ninth

Circuits

interpretation in turn

of the Betamax
limit

defense

makes
freettoin

it

risky to
to

ignore
the

cease

From copyught or service

owners

which

may

developers
infringing

detine

architecture of her product noninfringing
that

Once you
serve as

have

received
to

notice

of

specific liability

activhy

your substantial

uses may no
to

longer
to

shield

contributory

Of course even
behind the

the Ninth Circuit recognized challenged service or product

the ability

respond

these notices
is

may
to

be

limited by the technology the limits of what
is

Nevertheless

when
Napster

court

required
certainly

determine

technically

reasonable
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the results otcontrihutor
to

can be uncertain
or vicarious
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decision
liability for

suggests that
to

copyright
that

owners

once they make

infringement
it

are

in

position

take steps predict

reduce

the likelihood
in

will

he used

infringing activity

of P2P tools demand developer What these steps might entail is difficult
capabilities

to

hut

may

include

sonic

eases modilicafion

of the architecture

and

of the tool

service

or

system

The

DMCA
In

Section 512
in part to

safe harbors
the concerns of ISPs regarding
their potential liability for the

998

responding

copyright

infringement harbors

of their users
in

Congress enacted

number

of narrow safe harbors for copyright
in

liability

These

safe

appear These safe harbors
iunetions

section apply

512 of the Copyright
only to

Act which

turn appears
anti

in

title

17

of the

U.S Code

17

U.S.C

512
four

online

service

providers
storage

only to the extent

that

the infringement

involves

transitory

network transmissions
ofinfonnation

caching

of materials on behalf

of users

e.g

web

hosting

remote

Pie storage

aod the provision

location tools

e.g

providing

links

directories

search engines

Each and
reflects

of these functions
the
state

however
1998

is

narrowly

defined

hy the

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g. they dont
caching today

cover

what youd by

think
1998
fails

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art in

bor example

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eflbris

web page
of Akamai

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fit

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safe

harbor while the LOOIe sophisticaied
file

may not Because Congress did may
not within the four Napster passes
as

not anticipate

peertopeer

sharing

when

it

enacted
to

the safe harbors
ruling

many P2P
district in

products

enumerated

functions

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an

early

by

the

court in the question
just

ease an
its

DSP
own

cannot use the transitory
private network

transmission

safe

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unless the traffic flunk
this

through

Many

will by their very

nature

requirement

Napster

did

in entities

addition to

being with

limited to

certain

narrowly-circumscribed interlocking
statutory

functions

the safe

harbors

are

only available to

that

comply

number

of complex

requirements

The

online

service
the

provider

DSP must
who
been
that

adopt reasonably
are repeat widely

implement

anti

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users of

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terminating

accounts

of subscribers
have
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accommodate

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standard
use

technical

measures

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basis of industry-wide

consensus

e.g

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exclusion designate

headers

block

spiders
to

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agent Th.e

copyright
and

agent
place

receive

notices

of alleged

copyright
for the

infringement

register site

time

with the Copyright Office

relevant contact
of

information

agent

on

its

web

DSP must

upon receiving

notilication

mfringemcni
and

from

copyright

owner

expeditiously

remove

or

disable access

to

the infringing material

notice

takedown
or been aware of facts

The DSP must
apparent

not

have known about

the infringement
the

from which such

activity

was

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must

ii

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head

in

sand approach
benefit

you

lose

the safe

harbor
where

he

DSP

not

receive

direct

financial

from intiinging

activity

in

situation

the

DSP

http//www.gtamarketing.eom/P2Panaiyst/VonLohmann-articl.e.html

7/12/2008

Peer-to-Peer

File

Sharing

and Copyright Law

after

Napster

Page

of

11

controls

such

activity

i.e.

if

youre

liable

lix

vicarious

liability

the salb

harbor

may

not protect

you
to

in

the final analysis

qualifying

for

any

of

the

DMCI\

sale

harbors

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to

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The
enacted

DMCA ban on
recent as part

circumvention technologies
landscape
to

One work otcet
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addition to the copyright

deserves

special ally

attention technology

Section

1201
at

of the Copyright

Act

of the

DMCA
ful For

makes

it

unlawful

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aimed

protecting

copyrighted

In

addition also
it

the development

distribution if

or use of circumvention

technology
rights

or devices

is with only narrow

exceptions
build

unla

example
for tool

copyright
to

owner
the

uses

digital
tile

management

DRIVI
software

solution

to

song

would he unlawful
software video

anyone
to

crack

encrypted

without

the copyright

osners permission
which
is

or

or distribute

designed represents

crack

the file The
first

litigation

involving

DeC55

capable

C\

of decrypting

DVDs

one of the

cascs testing

these anti-circumvention

provisions

of the

Of
orotocois

course circumvention
such as Gnutella
as

technology
facilitate

is

not

necessarypart

of
the

peer-to-peer file-sharing
file

network

Todays
in

P2P

simply

tile

transfens leaving

itself

whether
there

encrypted

or not unaltered
interest

Nevertheless
integrating

copyright

owners
tools

begin

to

deploy

DRM
In

and

watermarking
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systems
broad

may

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cjrcumventon

with

tilesharing tools

light

DMCA

ban on circumvention

technology

however

any such

integration

may

substantially

increase the risk of liability

Lessons and Guidelines
few general guidelines
take that
11w

for
can he

P2P Developers
derived he an

P2P
that

developers your
project

from the discussion
inviting target for

above

These

are

steps

you can
placate and

may

reduce

the chance

will

easy

copyright

owners
than can pioduets

your investors when they ask you whether you are likely to spend their money on litigation rather minimize the chances that your case will become the next legal precedent that content owners
future innovators

use to threaten

Of course

because

the

relevant

legal

principles

are

still

in

flux these guidelines represent

merely one general

analysis olthe legal

landscape

please consult

with

an

attorney regarding

your precise plans

Your two options
In either

total

control

or total

anarchy
that

the

wake

of

tIme

Napster allows

decision
for

it

appears

copyright and
control

law

has

foisted

binary choice

on

P2P developers makes such

build

sstem
antI control

that

thorough impossible

monitoring This

over user activities from the Ninth

or build one that

monitoring
and

completely
in

conclusion

stems

Circuits

analysis of contributory

vicarious

liability

the Napster case

As
contribute
tiler

discussed

anove
adds

contributory

infringement
In

requires

that
it

you have
will

knowledge
to

of and materially material contribution
contributed he on
to

to someone

elses

infringing activity
to

most casc

be

difficult

avoid

all if your system
acm

any value

the user experience on

ou probably

have

rnatcriall will likely

any

ntrmngtng user

itics

Sc the chief battleground

contributory

infringement

the itnou

ledge

http//wwwgtamarketing.com/P2Panalyst/VonLohmann-article.html

7/12/2008

Peer-to-Peer

File

Sharing

and Copyright

Law

after

Napster

Page

of

11

issue

The

Napster

courts analysis suggests
cease

that

iikrn.gi
nat
.1

aetivin
that

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it

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once you receive notice that your system is being used for to stop copyright owner you have duty to do something of your system but may ultimately he you
to

it

mivht by

tsometihng

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Well
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that

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many P21 cases
for

so
court

long as the system

permits or enables
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infringing materials
fight

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serve as

draw

users

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to

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on the control element The
constitute

Napster

the right to block

users access
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service users
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was enough
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fullest

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court also
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had

duty to monitor the

of

its

to

extent

possible
that

Accordingly
it

order to avoid monitor

vicarious liability infringing users

P2P developer
or choose an

would be wise
architecture that

either

incorporate

mechanisms

easy

and block

will

convince

judge that

monitoring

and blocking

impossible

Better

to

sell

stand-alone

software

products

than on-going

services

As
power htncfit
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liability

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perhaps

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risk

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P2P developers
liability

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the

Lerminate the

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financial joining

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is

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unaware

of what your users are up

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financial

benefit are enough

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the if

business
oiler

models

tit

this

control and

benefit paradigm
monitor your users on

What

this

means
to

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after

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decision
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if

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service
obligations

you want
to set

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liability

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monitoring
the

you may have to youll have to give up
in

eonttoi
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its time

aside

the

lessons

youve

learned about

importance
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your system may be used
threshold
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to

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vicarious

liability

those infringing uses you will need

up

any control over users

Vendors of standalone
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liability

software After
optical

products
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it

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Sony

\CR
or audio

has

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over

what the enduser does with
built to

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do the makers some of which
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of photocopiers

scanners

cassette

recorders

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with

many uses only
or
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infringe copyrights
to

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out tbr those shrinkwrap
also

software

terms

termination Not coincidentally

these manufbcturcrs

typically

dont

sued

at
kill

least

by copyright

owners

The key

iemiination

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here
is

to

let

you

ma

have over your

users -no remote

switch contractual

Can

you

plausibly

deny

knowing what your endusers
by

are up

to
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Assuming
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that

you have escaped

vicarious

infringement
liability

eliniinating will

or financial

benefit there

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infringement
activity If

To

avoid

here you you

address

whether you
cleniability fbr

knew
into

or

ould
product activity

have

known

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for trouble

of your

users

Have

built

of plausible

your

architecture

model

you promote
software
that

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sell

facilitate

the use of your product

infringing than

youre

asking
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usage give

reports
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and

lead

to

more knowledge

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the choices

arc total control

or total anarchy

see

ahoy

http//wwwgtamarketing.eom/P2Panalyst/VonLohmann-artiele.htmi

7/12/2008

Peer-to-Peer

File Sharing

and Copyright

Law

after

Napster

Page

of 11

here are other good

reasons for designing

deniahility

into

your

product

or system

First

it

protects

your

users

aod depending
doing

On

your

architecture information uscr

hosts or nodes as well if youre
trout

not collecting reasons that can

information

about

what theyre

no one can

get that

you Thats

important aet\

lbr

have

little

to

do with copyright and pd cacy
it

tew Ih

not collecting

ionvaton

peortopeer

orks

prumote
target

free

specth

a.

U.2

he

IAS

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our
uses

makc

vourn

for

snhpoenas

you oont ha\

in

hat arc

your substantial

your produci

is

intended

to

work

solely

as

mechanism

for

copyright

piracy be

youre
for

asking

for legal

trouble

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paraphrase

peer-to-peer systems can

used

many

different

purposes
to

So

create

platform

that

lends
if

itself to

many uses or
and

William Gibson

let

the street find support

its all

own

uses

for

things
just

For example or Divx

youre developing Actively sincerely

file-sharing

system or distributed
enthusiastically

search engine

file

types not

MP3

files

promote the noninfringing

uses

oCyour product

And dont

promote any infringing uses

The
defense
until if

existence challenged

of real
in

substantial

noninfringing

uses will increase
it

the chances noting
that

that this

you can
defense

invoke
will

the

Bctamax
you point

court

As discussed above

however
letter

is

worth

only help

the copyright

owner

delivers

cease
and

and

desist

notifying you of with an obligation of your system

specific to

infringing

activity effort

At
to

that

the

Betamax

defense
WI-tat this

may

evaporate
will

may

leave von

make
the

reasonable

stop the

infringement

means

depend on

the

architecture

and

whims

of the court

Disaggregate

functions

Separale peer networks intels security
entity

different

functions

and concentrate
to

your

efforts

on

discrete

area

In

order to be successful

peer-to-

will

require products

address numerous

functional

needs---search
to

e.g OpenCOLA
lit

security

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toolkit

dynamic
all

file

redistnbution
In
titet is

e.g

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set

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reason

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the

creation

mix oi nteroperabi

hut distinct

applications

probably

good idea

open irom

of protocols

with

competitive

productengineering

Point of

view

This blank video

approach tape

may

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all

advantages

If

Sony had not only manufactured
clubs and

VCRs

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sold

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distributed out

the

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ease

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sharing
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Part

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single piece of software

handled

product

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on

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other

hand

each

entity

may have

better

legal

defense

charge

of infringement

court can order you to It to stop infringing activity model moreover max limit what by your disaggregated usd5 For example ifa search engine that trawis the P21 network orvicrriowly space were to he held contributorily liable or titeilitating access to copyrighted works the search engine company would not be able make any changes to dilierent an anonymized secure tilesharing product that was developed by company As the Napster court

recognized

you can

only he ordered

to

police your

own premises

Ihe

smaller

it

is the less

you can

he

required to

Finally \iilleitnium

certain

functions

Copyright Act
of

DMCA
sharing

may

be

entitled

to

special for

protections

under

the safe
special

harbor

provisions ot

the Digital the

Search

engines
with

example

enjoy

DMCA

protections
to

Thus
in

nnthmation

P2P

file

application

third

party

search engine

might be

easier

defend

court than

ar ers

mi egratecl

solut

icn

Dot
Avoid

make your money from
models
that

the

infringing

activities

of your users

business

rely

on revenue

streams that

can

be

directly

traced

to

infringing activities

For

http//www.gtamarketing.com/P2Panalyst/Von1

ohmann-article.htmi

7/12/2008

Peer-to-Peer

File

Sharing

and Copyright Law

after

Napster

Page

10 of 11

example unHcied
neclianisnl

if

you arc developing
the

through

tn

peertopeer

auction

system do not take
tile

percentage system
all

cut

on transactions payment

take another
fi

exwnple

peertopeer
lakes

sharing

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includes

ncit

might pose snnilar problems aencratea horn sates bceeg

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it

sencior

percentage

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payments

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fiic

idi

fi

iat
to

12n
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infringing

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building

your user base on

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for

trigger

ieariuu

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ertlicless

nothing

to

he gained

by

your business
it

benclit owners

en more
to
stint

directly

linked to

activity

by users-youll

only be

making

that

much

easier

copyright

you

down

Be open source
ln offer

addition

to

the

usual
in

litany

ot

special adantages or financial

the peerto-peer

arguments favoring the opensource model the open source approach may realm It may be more difficult for copyright owner to demonstrate
to to

control

benefit with respect no one has Financial
the ability

an

pen
he

source product
or

After

all

anyone

can

download

and compile
of the
directly

open source
esulting
realize

code

aud

terminate
also

block access
concept
the

or otherwise

control the use

applications
financial

benefit may

problematic

where the developers
court has
the

do not

any

gains from the code so this

as

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abo
save

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embraced
legally

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benefit

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you

Finally
projects

by making
of others

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elements out of

of tl1e P2P network open source or relying on the open source
iriore legally defensible ancillaiy services

you can build your business
tile

such

as search services

bandwidth enhancement

storage

file

meta-data

services

etc.

Do

Dot

he

direct

infringer make

and store no copies

This one may be oln ious but remember works you may he held liable as copyrighted
not be available
to

that direct

if

you

ihe

court will not be

interested

of any copies even if only in case many of the defenses discussed here will infringer in control or knowledge or financial benefit or material
distribute In that

you make or

RAM

eontnbution

if

you macic

copies

youre

probably

liable for

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is

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most P2P developers
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tl

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central

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actual

being shared

need

irough

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server

Nevertheless

where caching

or similar

activities

concerned

Do
Avoid
protect the crack so leave
it

not build

any

circumvention

devices

into your product

incorporating

into

your product

any technology

designed

to

circumvent

protection

measure meant
that
is

to to

righis

of copyright

owners

For example

do not incorporate

any

code

into

your product
about
to

intended video

the

CSS

encryption

system used on
out

DVDs

bypass

the proteetion scheme
files

used on Sony
think

Playstation

lIe
to

no copy
others

flags

of streaming

RealAudio
without

Whatever

you may

the merits of this

games work

Youll have enough

orries

adding

circumvention

liability

the list

10 Dont
This
In tip

use

someone elss trademark

in

your

name
lark

tlocs are

not relate atteinptinv

to to

copyright
capitalize

but rather

trademark

hs

also

good common

sense Many

early

peer

oeer products
their

on
and

the

notoriety of Napster
to legal

by incorporating
Napster
rariety

portions ofthe
itself to

Napster strong

name

into Jc

producis--Napigator of
its

OpenNap

name
as

few

has

shown

he

feacka

trademark

righk bar ing threatened
dangerous

action

against
it

of unauthorized
it

vendors owners

OnutelIa

may

also be

name

to

appropriate
their after

is

not

clear

of the Nutella trademark
forced
to

may at
its

some

point assert
to

own

trademark

who owns rights And rcmember
from

AOL

Napster

merchandise whether the

and

that

AppleSoup

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changed

name

Fly-Code

receiving pressure

Apple Computer

httn1/www.gtamarketing.com/P2Panalst/VonLohmann-article.html

7/12/2008

Peer-to-Peer

File Sharing

and Copyright

Law

after

Napster

Page

11

of

11

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practice concentrated
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on transactions and
interests the
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counseling
intersection ni the Dtgttal

involving
of

copyright

the internet
the

and information
including
issues relating

technology
to online

primary

legal

at the

copyright law and

Internet

music

distribution

and
with

application

Millennium Copyright

Act

DMCA

to Internet

businesses

He

has worked

variety of Internet

clients including

Yahoo

Verio

Myplay

Riffhge

Voquette

Universe.com

SpikeRadio and

BCi

Copyright

Information

Permission purposes
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ficddvonLohmann.eom

other permissions

Footnote

Acronym

for

am

lawyer
that

to distinguish

from the common
and

IANAL

am

not

lawyer

appears

on Slashdot

other online forums

2001

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von

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http//www.gtamarketing.eom/P2Panalyst/VonLohmann-artice.html

7/12/2008

Date Printed

July

12 2008

URL

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