Grokster under the gun

Slam dunk for the copyright holders!

An AP report notes that the US Supreme Court has ruled that Internet file-sharing services, such as Grokster (a service run by StreamCast Networks Inc) and Morpheus can "be held responsible if they intend for their customers to use software primarily to swap songs and movies illegally." In a surprise move, the justices unanimously rejected "warnings that the lawsuits will stunt growth of cool tech gadgets such as the next iPod." The BBC characterizes the ruling as making clear that the "file-sharing companies are to blame for what users do with their software." It seems clear from the ruling that the Court believed Grokster could be facilitating illegal activity, i.e., copyright infringement.

The case, MGM v. Grokster, had been "brought by 28 movie and music makers who claimed that rampant piracy was denting profits." Even though the Supreme Court justices hadx been expected to rule in favor of the file-sharers - because of legal precedents such as a 1984 case involving Sony's Betamax VCR, they didn't do that. Instead the Court has set aside the precedent (and lower court decisions) because they've determined that "the makers of a technology have to answer for what people do with it if they use it to break the law." Notes the BBC:

In the ruling Justice David Souter wrote: "The question is under what circumstances the distributor of a product capable of both lawful and unlawful use is liable for acts of copyright infringement by third parties using the product."

He added: "We hold that one who distributes a device with the object of promoting its use to infringe copyright ... is liable for the resulting acts of infringement by third parties."

The decision sends the cases back to a lower federal district court - which had previously ruled in favour of file-sharing services. "The justices said there was enough evidence of unlawful intent for the case to go to trial" (AP). For Grokster, this is likely to mean a hail of litigation coming down on it. In other words, now that the Supreme Court has ruled that in principle that file-sharers can be held responsible for illegal activity conducted with their technology, it will now be up to the trial court to decide in this case whether Grokster is in fact responsible for such illegal activity. And it won't be just one trial now, but many.

The BBC also notes that the decision could "have an impact on any technology firm developing gadgets or devices that let people enjoy media on the move. If strictly interpreted the ruling means that these hi-tech firms will have to try to predict the ways people can use these devices to pirate copyrighted media and install controls to stop this infringement."

The file-sharing ruling and other rulings come on the last day (today) of the Court's current session, prior to breaking for a three-month summer recess.