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Press Release

    Tech Bytes - Tid Bits in Tech News: The Fall of Napster

    02/14/2001

    Once again, it appears that the death knell has sounded for Napster, the popular Internet music-sharing service that boasts 50 million users. Monday, the 9th Circuit Court of Appeals ruled that the site must shut down pending a full copyright infringement trial. By soundly rejecting Napster’s legal arguments, the court rigorously reinforced the role copyright in the digital world.

    The preliminary injunction was an enormous victory for copyright owners, most notably the member corporations of the Recording Industry Association of America (RIAA). Copyright owners are now positioned to shape the future of Internet content delivery. Although consecutive courts agreed wholeheartedly with the recording industry’s legal arguments, from a policy perspective this newfound control over content delivery software has the potential to limit innovation and to hinder Internet growth.

    Perhaps no application has seized upon the possibilities of the Internet more effectively than Napster. Napster’s climb to 50 million users makes it arguably the fastest growing computer application in history. Anecdotal evidence suggests that many of these users have purchased broadband connections to enhance their Napster experience. The file-sharing software’s sheer popularity and bandwidth-intensive operation has led to more Internet users in general, and more broadband connections in particular.

    However, popularity does not insulate any technology from legal scrutiny. But the logic of the 1984 Sony decision seemed to suggest that Napster should be allowed to exist. Sony held that an entity could not be guilty of copyright infringement if the technology has “substantial noninfringing uses.”

    Monday, the 9th circuit ascribed a distinction between Napster’s “conduct” and “the architecture of the Napster system” to circumvent the logic of the Sony decision.

    The court did not hold Napster liable “merely because peer-to-peer file sharing technology may be used to infringe plaintiffs’ copyrights,” nor does it hold “that Napster failed to demonstrate that its system is capable of commercially significant noninfringing uses.”

    While these findings appear to immunize Napster based on Sony, the court relied upon Religious Technology Center v. Netcom On-Line Communication Services, Inc to delineate between thought and action. The plaintiffs were able to prove that Napster’s founder and executives were aware of the system’s copyright infringing uses, therefore the court ruled that the Sony doctrine is “of limited assistance to Napster.”

    The court seems to say that if plaintiffs provide “evidence of specific acts of infringement,” then system administrators must remove the offending material. If the administrator does not, or cannot, the system will be forced to cease operations.

    A system to share files based on software protocols can legally be facilitated by the servers and routers of the Internet. However, if a copyright holder can show that copyright infringement takes place over such a system, and its attendant does not, or cannot stop this infringement, it’s presence on the web can be shut down.

    It is peculiar to note that Internet Service Providers (ISPs) seem immunized from similar scrutiny by a provision of the 1998 Digital Millennium Copyright Act (DMCA) that exempts ISPs from liability for the actions of its users. Part of Napster’s defense was that it was an ISP and protected under the ISP-loophole the DMCA. Both the circuit and appeals courts disagreed.

    Any site, network, or application that allows for any type of file-sharing or IP-based communication that does not have the lucrative “ISP” label should take heed of Monday’s decision. If it survives intact, technology firms and network administrators may find themselves so hamstrung with copyright concerns that they will be forced to co-opt the RIAA on each and every business decision.

    If future Internet service technologies want to avoid costly contributory copyright infringement suits, they should follow the logic of Monday’s decision and rename themselves Internet Service Providers.