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Bill Targeting P2P Circumvents 'Betamax' Ruling

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Jul 26, 2004 2:36 PM PDT    Text size: 
WASHINGTON, D.C. — The federal Copyright Office is backing legislation that would create a new form of copyright liability for “intentionally inducing” infringement.

The Inducing Infringement of Copyrights Act of 2004, or S. 2560, introduced last month by Sen. Orrin Hatch, R-Utah, would amend Section 501 of the Copyright Act that would target peer-to-peer file sharing operators like Kazaa or Grokster.

The register of copyrights, testifying before the Senate Judiciary Committee last week, said that the measure “addresses the most important issue facing our copyright system today.”

The language defining the key term “intentionally inducing” is: “intentionally abets, induces, counsels, or procures, and intent may be shown by acts from which a reasonable person would find intent to induce infringement based upon all relevant information about such acts then reasonably available to the actor, including whether the activity relies on infringement for its commercial viability.”

Critics of the legislation say that if the bill were to pass, the language could have the effect of overturning the 20-year-old Sony decision.

In Sony Corp. of America vs. Universal City Studios Inc., 464 U.S. 417 (1984), the U.S. Supreme Court ruled that Sony was not contributorily liable for alleged copyright infringement caused by consumers who used Sony Betamax VCRs to tape broadcast movies and TV programs without authorization.

In its reasoning, U.S. justices adopted a rule that where the copying equipment is “capable of substantial noninfringing uses,” such as time-shifting, then the sale of that equipment does not constitute contributory infringement.

The file-sharing network operators have shielded themselves using Sony-Betamax case, saying that peer-to-peer networks can be used for noninfringing uses. The operators say they shouldn’t be held contributorily liable for those users who abuse the service.

The Copyright Office, in its testimony last week, said that because courts are encountering problems in applying common law doctrines of secondary liability to unauthorized file sharing, Congress should replace it “with a more appropriate rule” for the digital age. And that would mean reexamining the landmark Sony decision.

Gary Shapiro, president and chief executive officer of the Consumer Electronics Association, told a judiciary committee that Hatch’s legislation would “reverse and rewind” the Sony-Betamax decision, and is “by far the biggest threat to creativity in the last 20 years.”

Shapiro argued that if the bill was the law, “we would not have the photocopier, iPod, or TiVo.”

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