The Supreme Court handed down the Grokster decision this morning. Full background at EFF's MGM v. Grokster page.
The Court remanded for trial on Grokster's infringing intent. The key passages of the unanimous opinion seem to be these. First, the court says that it holds
that 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. We are, of course, mindful of the need to keep from trenching on regular commerce or discouraging the development of technologies with lawful and unlawful potential. Accordingly, just as Sony did not find intentional inducement despite the knowledge of the VCR manufacturer that its device could be used to infringe, 464 U. S., at 439, n. 19, mere knowledge of infringing potential or of actual infringing uses would not be enough here to subject a distributor to liability. Nor would ordinary acts incident to product distribution, such as offering customers technical support or product updates, support liability in themselves. The inducement rule, instead, premises liability on purposeful, culpable expression and conduct,
Yes, footnote 12 does say that,
Of course, in the absence of other evidence of intent, a court would be unable to find contributory infringement liability merely based on a failure to take affirmative steps to prevent infringement, if the device otherwise was capable of substantial noninfringing uses. Such a holding would tread too close to the Sony safe harbor.
But the text finds the evidence against Grokster developed so far to be quite strong. So while this isn't a disaster for copyright law, it's not good news for Grokster.
Note that the Ginsburg concurrence, for herself and two other Justices, would set a much tougher standard that would mean you get in trouble for making a popular product regardless of your own conduct:
Even if the absolute number of noninfringing files copied using the Grokster and StreamCast software is large, it does not follow that the products are therefore put to substantial noninfringing uses and are thus immune from liability. The number of noninfringing copies may be reflective of, and dwarfed by, the huge total volume of files shared.
The Breyer concurrence, also for two others, leans the other way, emphasizing the endurance of the Sony standard.
My bottom line: Grokster loses, but the grounds are narrow enough that — in my best guess — Bittorrent survives.
You can compare this to what the real experts will be saying at the SCOTUSBlog Grokster discussion page.
they seem to be mostly trying to target companies entirely built upon copyright infringement,
and it’s hard to deny that grokster/streamcast/gnutella clients were not so built.
their ads were mostly about “get free music/movies now”
bittorrent is mostly just bram asking people for donations while reminding them about the first amendment. he’s very neutral when discussing what content is being distributed, ie just “files” not “copyrighted files.”
contrast that with the absolute obnoxiousness of streamcast:
(from MGM v Grokster)
StreamCast developed promotional materials to market its service as the best Napster alternative. One proposed advertisement read: “Napster Inc. has announced that it will soon begin charging you a fee. That’s if the courts don’t order it shut down first. What will you do to get around it?” Id., at 897. Another proposed ad touted StreamCast’s software as the “#1 alternative to Napster” and asked “[w]hen the lights went off at Napster … where did the users go?” Id., at 836 (ellipsis in original).7 StreamCast even planned to flaunt the illegal uses of its software; when it launched the OpenNap network, the chief technology officer of the company averred that “[t]he goal is to get in trouble with the law and get sued. It’s the best way to get in the new[s].” Id., at 916.
at any rate, now is a good time to set up a *waste* network with your friends:
http://waste.sourceforge.net/
One thing I noticed is that the Grockster decision explicitly ties interpretation of ‘substantial non-infringing uses’ to the standard used in patent infringement cases.
I think that this is important because almost all of the amateur lnternet lawyer interpretations and many of those advanced by the advocates of both sides of Napster Grockster etc. of Sony vs Universal have ignored this aspect of Sony and relied on interpretations that are largely self serving.
The RIAA has been pushing to make the bar for ‘substantial non-infringing’ ridiculously high while the folks at Napster believed that they were safe if there was merely the possibility of a non-infringing use.
I don’t think that the presence of the Guttenberg texts or other non-copyright material on Grockster should save it. The fact is that the primary distribution medium for all of that material is the Web with FTP second and Grockster a very very distant fourth or even fifth. The distribution of that material will not be impacted in the slightest if Grockster was to disappear.
Using patent law as the basis for interpretation means that the Sony rule is now backed by reams of trial experience, before the parties were arguing that ‘substantial non-infringing’ meant whatever they damn well pleased.
I think it is pretty clear that the primary design objective of Grockster is to avoid and evade user accountability. You don’t need to do that unless the publishers of the material are doing something that would require them to avoid accountability.
There are legitimate reasons for avoiding accountability in totalitarian regimes, however it is very clear that the Web makes it possible for any political point of view to be published regardless of attempts by hostile governments to censor them. Nor is the architecture of Grockster particularly suited to distribution of Samizdatt. The primary intent of Grockster is clearly to assist its users in evading accountability for copyright theft.
I think that Bittorrent may well end up being a grey area, it is clearly close to the line and I would not want to depend on the line being drawn on one side or the other. Google on the other hand does not appear to have any real difficulty since the primary purpose of Google is very clearly to support legitimate search.