Supreme Court Sets Date for Grokster Case

Matt O'Conner
WASHINGTON, D.C. — The U.S. Supreme Court will begin hearing oral arguments in MGM v. Grokster, a case that will decide whether peer-to-peer software companies and file-sharing networks are responsible for the actions of end users, on March 29.

Entertainment companies, including the Recording Industry Association of America and the Motion Picture Association of America, hope to set a legal precedent that would make P2P companies liable for revenue the entertainment industry claims its losing due to illegal sharing of copyrighted material by P2P products users.

The hearings will be the final step in a series of court cases dating back to 2001. So far, the P2P companies have won victories in both U.S. District Court and the 9th U.S. Circuit Court of Appeals.

Both lower court rulings were based largely on the Supreme Court’s decision in the 1984 Sony Betamax case, which determined that Sony was not liable for copyright violations committed by users of its Betamax video recorders.

In that case, the court pointed to the fact that Sony’s product also had, and was intended for, legal, noninfringing uses as a deciding factor in its ruling.

But Hollywood argues that the Betamax case doesn’t provide a suitable precedent since Sony had no way of preventing illegal use of its recorders, whereas P2P software developers can code applications to block illegal file sharing.

Fred von Lohmann, senior intellectual property attorney at the Electronic Freedom Foundation, which is helping to defend the P2P companies, said he is confident the Supreme Court will reaffirm the Betamax ruling.

“In 1984, the Supreme Court announced a general rule — that technology companies will not be held responsible for the sins of their customers, so long as the technology in question is capable of noninfringing uses,” von Lohmann told XBiz. “That rule applies today just a much to the makers of P2P software, iPods, CD burners, and TiVos as it did in 1984 to the makers of VCRs.”

“The entertainment industry has been attacking the Betamax principle for several years now in several cases, so I think it is appropriate for the question to be answered by the Supreme Court,” von Lohmann added.

A final ruling in the case is expected by the end of July.