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Hollywood Gets Support in P2P Appeal

The recording and motion picture industries have lined up a throng of allies to beef up a crucial appeal to overturn an earlier court ruling that two popular file-sharing could not be held liable for copyright infringement by users.

In support of the appeal filed on August 19, four separate amicus (friend-of-the-court) briefs have been introduced in the U.S. Court of Appeals for the Ninth Circuit, arguing that the earlier decision rendered by District Court Judge Stephen Wilson was wrong and created "a gaping technological loophole" that hurts copyright holders.

The four briefs were filed by a group of copyright experts and law professors, members of the copyright community, international rights owner organizations and legal digital music download services.

In a 39-page brief prepared by nine law professors and treatise authors on intellectual property and copyright law, the group argued that Judge Wilson misjudged the elements of contributory and vicarious liability in his April decision.

That ruling, the experts contend, "has created a gaping technological loophole that jeopardizes the ability of long-standing copyright principles to redress viral online infringement."

"[We] believe that those interests have been threatened by the lower court's opinion granting summary judgment to the defendants, which departed from established principles of contributory and vicarious copyright infringement, misapprehended the policy rationales on which those two doctrines rest, and abandoned to Congress all responsibility for redressing the massive infringement abetted by defendants," the brief argued.

The brief, filed by professors and lawyers from NYU School of Law, Harvard Law School, Bingham McCutcheon LLP, among others, said the District Court ruling included "dispositive errors" in applying the law of liability and "failed to recognize the policy interests those doctrines effectuate."

The group argued that the court's ruling on Napster gave clear notice that the law "would not tolerate those seeking to profit from such enterprises." However, despite the obvious similarities between Napster and the Morpheus and Grokster networks, the district court here reached a result contrary to Napster, according to the filing.

The experts contend that it's near impossible for the recording and motion picture industries to efficiently control the millions of infringements that occur daily on the peer-to-peer networks, arguing that the file-sharing firms can control infringements "if properly motivated."

"From a policy perspective, it would be better to permit copyright owners to protect their rights through actions like this one, instead of in a multitude of individual suits against direct infringers, to obtain the most effective relief against those whose "infringement factories" are at stake," the group added.

In the brief, the group of legal experts claimed the District Court's refusal to consider comparable constructive knowledge evidence "ignores not only the law, but also the important policy rationale for imposing liability based on constructive knowledge: to hold otherwise would encourage willful blindness on the part of one who materially contributes to direct infringement."

A separate amicus brief filed by members of the copyright community echoed those sentiments. "The lower court in this case deviated dramatically from case law governing contributory and vicarious infringement. It articulated new, narrow standards that are unsupportable under controlling precedent and constitute terrible public policy."

The copyright holders insist that the District Court's "misapplication of law" would create loopholes and frustrate efforts to limit online piracy.

The major legal music download services -- BuyMusic, Echo, Full Audio, Liquid Audio, MusicNet, MusicRebellion, Pressplay -- also filed a support brief outlining the difficulties they face with building a business to compete with free music widely available on the P2P networks."The District Court failed to understand that copyright law regulates conduct, not technology," the music services argued, pointing out that in addition to the "impossibility of competing with a free service," their businesses were harmed by difficulties competing against companies that "do not respect the requirements under which the music industry licenses and releases its music."

"Because the illegal networks do not have to respect the term of a license, consumers do not understand that under the existing licensing models legal on-line music services currently may not offer all digital music on an unrestricted basis," the brief read.

The briefs were all filed to help the appeal to overturn Judge Wilson's ruling that Grokster and Morpheus could not control how people use their software, which could also have legitimate applications. Judge Wilson cited the famous Sony Betamax case of 1984, where the Hollywood studies tried to outlaw VCRs but ran into a Supreme Court ruling that use of new technology to infringe copyrights did not justify an outright ban on that technology.

"Grokster and Streamcast are not significantly different from companies that sell home video recorders or copy machines, both of which can be and are used to infringe copyrights," Judge Wilson wrote.

That ruling did not cover the defendant's liability for damages from past versions of the software or from other past activities. It also does not cover Sharman Networks' Kazaa Media Desktop, which is also being sued by the Recording Industry Association of America (RIAA) and the Motion Picture Association of America (MPAA).