1 April 2010

ISO Hunted Down

Stories involving file-sharing networks and copyright enforcers have become easily predictible: the latter commence court proceedings against the former and after a lengthy judicial argy-bargy (almost always) prevail thereby having the enabling network shut down. Unfortunately for all file-sharers among my readers, this post tells a story that makes no exception to the foregoing. It is dedicated to isoHunt and its legal battle against Columbia Pictures and its yesterday’s announced probable death.

 

Courtesy to Ars Technica

The first proceeding in which isoHunt and its founder Gary Fung took the role of the defendants commenced somewhere in 2006 and has brought some legal clouds over that network. Notwithstanding, in this post I would like to more properly address the last ruling of the US District Court for the Central District of California which is capable to eventually provide the defendants with their Hemlock cup.

In the instant case claimants had moved for a summary judgment against the defendants on the grounds that defendants’ users have infringed claimants’ copyrights and defendants are therefore liable for such infringement under the theories of inducement, contributory infringement, and vicarious infringement. Not surprisingly, Judge Wilson granted claimants’ motion for a summary judgment. What makes this ruling noteworthy is Court’s profound discussion of the torrent technology concerned and its findings on defendants’ liability.

A good starting point in the discussion could be made by the fact that the ruling in question was delivered by the Honorable Stephen Wilson – the judge who presided over the original Grokster case. Whether therefore or not, but his Honour seems somewhat exerted to make as many references to the Grokster cases as only possible. Thus, in his view, defendants’ torrent sites, albeit demonstrating a unique download process, represent an evolutionary modification of traditional “peer-to-peer” sharing sites such as Napster and Grokster. They would only differentiate in that the files, awaiting to be shared, are hosted locally on the file-sharers’ computers and not on a centrally operated server. In order to accesss the files, the file-sharers would need a “library” that maintains an index of torrent files available to download. These files do not contain copyrighted materials themselves, but the data used by a torrent client to retrieve copyrighted materials through a peer-to-peer transfer. Such files have been previously uploaded by (other) users who host the copyrighted materials locally. Once a user downloads a given content file, he also becomes a source for future requests and downloads.

In its liability analysis the Court found that defendants’ inducement liability was so overwhelmingly clear, and that a discussion on the remaining two liability theories, ie secondary and vicarious liability, would be unnecessarily duplicative.

The Court stated that claimants have used IP-address data to locate defendants’ users and show that particular infringing downloads took place in the United States. Further, claimants have provided, in Court’s view, sufficient evidence that, contrary to defendants’ wholly unsupported (arg!) assertions, torrent files downloaded from defendants’ sites correspond to and automatically cause the downloading of claimants’ copyrighted materials.

In determining defendants’ inducement liability, Judge Wilson quoted one of US Supreme Court’s dicta in MGM vs Grokster, according to which “one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties.” In citing the Supreme Court in Grokster anew, the Court stated that the classic instance of inducement was by advertisement or solicitation that broadcasts a message designed to stimulate others to commit violations. By the same token, claimants, in Court’s determination, presented a variety of undisputed evidence that defendants disseminated a message “designed to stimulate others” to commit infringements. Thereafter, the Court found, defendants’ liability for inducement was no longer open to any doubt. Moreover, claimants engaged in “purposeful, culpable expression and conduct” aimed at promoting infringing uses of the torrent websites.

In a next procedural step, the defendants had raised a defence based on the Digital Millenium Copyright Act (DMCA) that favours providers of certain internet services. However, upon stating that claimants had established defendants’ knowledge of their users’ infringing activities and, as defendants (i) failed to show they were not aware of facts or circumstances relating to infringement, and as defendants (ii) failed to evidence that they had removed the infringing material once they became aware of an infringing activity, the Court dismissed the defence and denied claimants’ entitlement to statutory safe harbour under the DMCA.

In its conclusion, the Court once again quoted Grokster and ruled that defendants’ technology is nothing more than “old wine in a new bottle”, consequently the outcome in the instant case could only be the same as in Grokster.

In my personal view, the above ruling is in full compliance with the currently applicable US legislation and judicial authority. Notwithstanding, developments such as in this case show at least two things. First, there is an ever-growing demand to access copyrighted material online and the shutdown of, say, Grokster did not prevent the establishing of isoHunt and Pirate Bay and it is very likely that their shutdown shall be accompanied by new creations in the file-sharing realm. Second, the rights’ owners should more extensively and, within the boundaries of applicable law, consider opportunities that employ the new technologies and lead to, maybe less excessive, but still good earnings, instead of prosecuting its own prospective customers.

 

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