CS-202: Law For Computer Science Professionals Last Class: More Copyright Law

David W. Hansen, Instructor December 7, 2006

© 2006 Skadden, Arps, Slate, Meagher & Flom LLP

The Motion Picture Association Of America Strikes Back

Grokster

Grokster

(9

th

Cir. 2004)

• Grokster and Streamcast created “peer-to-peer” Internet services.

• These services enable millions of people everyday to copy and distribute, without permission and without paying, copyrighted sound recordings and motion pictures.

• It is undisputed that: – Grokster and Streamcast users are thereby committing copyright infringement.

– Infringing activity accounts for at least 90% of the activity on the services.

– Both services can be used lawfully for authorized exchanges of digital files.

Grokster

(9

th

Cir. 2004)

• Grokster and Streamcast do not earn revenue by distributing their software, which is free.

• Both services earn millions of dollars annually from ads that are displayed to users of their services.

• The services’ ad revenues are tied directly to the infringements.

• The services were designed to capture the millions of users who would be looking for an “alternative” when the courts “pulled the plug” on Napster.

Grokster

(9

th

Cir. 2004)

• It is estimated that more than

2.6 billion

infringing music files are downloaded each month.

• Between 400,000 and 600,000 copies of motion pictures are unlawfully downloaded

every day

.

• Estimates of lost music sales alone range from $700 million to

several billion dollars

annually.

• “Illegal movie trafficking represents the

greatest threat

to the economic basis of moviemaking in its 110-year history.” Dan Glickman, MPAA President (11/04) • The Register of Copyrights has described the scale of copyright infringement resulting from the use of these services as “

mind boggling

.”

Grokster

(9

th

Cir. 2004)

• The services were sued by the major motion picture studios and record companies, as well as a class of 27,000 music publishers and song writers.

• The suit sought an injunction against continuing infringement.

• The suit was based on the theory that the services were unlawfully “contributing to,” or were “vicariously liable for,” their user’s copyright infringement.

• A prior suit in the 7 th Circuit against Aimster had resulted in an injunction.

Grokster

(9

th

Cir. 2004)

• Contributory infringement: – There is no statutory rule of liability for contributory infringement – a court-made rule.

– The party alleging contributory infringement must show: • “(1) direct infringement by a primary infringer, (2) knowledge of the infringement, and (3) material contribution to the infringement.” • Vicarious liability: – An “outgrowth” of

respondeat superior

, which imposes liability on those with a “supervisory relationship” to the infringer.

– A defendant may be liable under a “vicarious liability” theory if the plaintiff demonstrates: • “(1) direct infringement by a primary party, (2) a direct financial benefit to the defendant, and the right and ability to supervise the infringers.”

Grokster

(9

th

Cir. 2004)

• The 9 th Circuit recognized that the Grokster and Streamcast software “enables a user to participate in the respective peer-to-peer file-sharing networks.” • The Court also recognized that “the

vast majority

of the files are

exchanged illegally

the copyright law.” in violation of • The Court noted that both Grokster and Streamcast

know

that their services are being used for infringement, and both services “

profit handsomely

” from their user’s infringement.

Grokster

(9

th

Cir. 2004)

• The Court nonetheless held that contributory infringement required a “higher standard” when an accused product or service has noninfringing uses.

• To avoid liability, “a product need only be

capable

of substantial noninfringing uses.” • The fact that at least 90% of the uses were infringing was not the proper inquiry.

• The services were not liable because the noninfringing uses have “commercial viability.”

Grokster

(9

th

Cir. 2004)

• The "uncontroverted evidence” showed “that many artists and authors

welcome

the free distribution of their works on P2P networks”: – Nine-time Grammy nominated singer songwriter Janis Ian credits P2P sharing of her music for increased CD sales.

– Numerous well-known bands, including Phish, Pearl Jam, the Dave Matthews Band and John Mayer have authorized free P2P sharing of live concert recordings among fans.

– The “record indicates that thousands of other musical groups have authorized free distribution of their music through the internet.” • P2P networks are also being used to distribute “shareware" and "freeware” software that is authorized for redistribution.

Grokster

(9

th

Cir. 2004)

• P2P is used to distribute noninfringing entertainment and promotional, as well as public domain and government works: – A variety of ventures, including the Prelinger Archives, GigAmerica, Reel Mind and J!ve Media, have built their businesses by using P2P networks to promote and distribute hundreds of thousands of authorized copies of music, games and video content.

– Several noncommercial efforts, including Project Gutenberg and the Internet Archive, have been using P2P networks to distribute thousands of public domain works.

– “[D]espite using a

deliberately blinkered

search strategy,” plaintiffs’ expert was unable to avoid finding public domain works by Shakespeare, the King James Bible, the Koran, the Communist Manifesto, and several of Plato's dialogs.

• The noninfringing commercial uses of P2P networks have been growing rapidly.

Grokster

(9

th

Cir. 2004)

• The Court held that “contributory infringement” required the service to have: “specific knowledge of infringement at a time at which they contributed to the infringement and failed to act upon that information.” • It was “irrelevant” that the services had notice of hundreds of thousands of specific infringements.

• Theses notices “arrive when Defendants do nothing to facilitate, and cannot do anything to stop,” the infringement.

• Unlike Napster and Aimster, Grokster and Streamcast did not use centralized servers that indexed available files.

– Even if they “closed their doors and deactivated all computers within their control, users of their products could continue sharing files with little or no interruption.”

Grokster

(9

th

Cir. 2004)

• The Court also held that the services did not “materially contribute” to copyright infringement.

• Defendants do not provide the “site and facilities” for infringement.

• Infringing messages or file indices do not reside on defendants’ computers.

• Defendants do not have the ability to suspend user accounts.

• Defendants are not required to upgrade their software to filter out infringing files.

– “Failure” to alter software located on another’s computer is simply not akin to the failure to delete a filename from one’s own computer, to the failure to cancel a registration name and password of a particular user from a user list, or to the failure to make modifications to software on one’s own computer.”

Grokster

(9

th

Cir. 2004)

• The services also were not liable on a “vicarious infringement” theory.

• Defendants did not have the “right and ability to supervise the direct infringers.” • The possibility of upgrading software on the

user’s

computers to install copyright filters was “irrelevant to determining whether vicarious liability exists.” • This may be a remedy required of those already found liable of vicarious infringement.

Option 1: Supreme Court

Grokster: The Cert Petition

•

Petition For A Writ Of Certiorari (USSC):

– Contributory liability should exist where the “predominant” and “intended” use was to further infringement for profit.

– Liability should exist where the service was designed to “disable” their ability to block infringement (while keeping available noninfringing uses).

– Allowing free services like Grokster and Streamcast to operate puts at risk the viability of lawful pay services like Movielink, CinemaNow & iTunes.

– Conflict between the 7 th and 9 th Circuits.

Grokster: The Cert Petition

•

The Opposition

: – The 9 th Circuit correctly interpreted the

Sony (US 1984)

decision relating to contributory infringement.

– Like the Supreme Court in

Sony,

the 9 th Circuit correctly concluded that Congress, not the courts, is better suited to determine how best to expand the scope of the copyright monopoly.

• There are currently 8 bills pending before Congress addressing P2P sharing.

– Injunction would have precluded significant noninfringing uses, unlawfully expanding the copyright holders’ monopolies.

– No circuit conflict: in

Aimster,

evidence was tendered of any noninfringing product use.” “no

Option 2: Congress

The “Inducing Infringement of Copyrights Act of 2004”

• S 2560 was introduced by Sen. Orrin Hatch (R-UT) and others on June 22, 2004. • The bill would create a new cause of action for “intentional inducement of infringement.” • It would not affect the existing court made law of contributory and vicarious infringement.

• The bill is technology neutral, but its wording suggests (and Sen. Hatch has stated) that the present intended target is distributors of P2P systems used to infringe copyrighted music.

The “Inducing Infringement of Copyrights Act of 2004”

• Commentators have suggested that the bill would have application to a range of activities in addition to P2P.

• The bill would add a new subsection (g) to § 501 of the Copyright Act: – (1) In this subsection, the term “intentionally induces” means intentionally aids, abets, induces, 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

.

– (2) Whoever intentionally induces any violation identified in subsection (a) shall be liable as an infringer.

– (3) Nothing in this subsection shall enlarge or diminish the doctrines of vicarious and contributory liability for copyright infringement or require any court to unjustly withhold or impose any secondary liability for copyright infringement.

Option 3: Sue Direct Infringers

Option 4: Education And Technical Measures

MPAA Nov. 2005 Press Release

Grokster – Supreme Court

• Vacated the 9 th Circuit order affirming summary judgment on June 27, 2005.

• Remanded for further proceedings.

• The Supreme Court held 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, going beyond mere distribution with knowledge of third party action, is liable, under the Copyright Act, for the resulting acts of infringement by third parties using the device, regardless of the device's lawful uses.

Grokster – Supreme Court

• The Supreme Court held that summary judgment in favor of Grokster and StreamCast was error.

• There was “substantial evidence” against Grokster and StreamCast on all elements of inducement of infringement: – Each had shown itself to be aiming to satisfy a known source of demand for copyright infringement.

– The copyright holders had shown that neither distributor attempted to develop filtering tools or other mechanisms to diminish the infringing activity using the software.

– The more the software was used, the greater the distributors' revenue from advertisements on the screens of computers employing the software became.

The Digital Millennium Copyright Act

The Digital Millennium Copyright Act Violations Regarding Circumvention of Technological Measures

No person shall circumvent a technological measure that effectively controls access to a work protected

under this title.

17 U.S.C.

§

1201(a)(1)(A)

Lexmark

(6

th

Cir. 2004)

• Lexmark sold “Prebate” and “Non Prebate” toner cartridges for its laser printers.

– “Prebate”: • Sold to business customers at an upfront discount.

• Customers agree,

via

“shrink wrap” agreement, to use the cartridge once and return the empty unit to Lexmark.

– “Non-Prebate”: • Sold without any discount.

• Not subject to restrictive agreement.

• May be re-filled with toner by the customer or a third-party remanufacturer.

Lexmark

(6

th

Cir. 2004)

• Two Lexmark computer programs were at issue: – The “Toner Loading Program”: • Located on a microchip in Prebate toner cartridges.

• Calculates the toner level.

• Two versions: 33 program commands (37 bytes) and 45 commands (55 bytes).

– The “Printer Engine Program”: • Located on a microchip within Lexmark printers.

• Controls various printer functions (

e.g.

, paper feed and movement, printer motor control).

• Involves over 20 pages of code.

• Neither program is encrypted and each can be read and copied from its respective memory chip.

Lexmark

(6

th

Cir. 2004)

• Lexmark printers use an “authentication sequence” that performs a “secret handshake” between the printer and cartridge.

• Uses a publicly available “Secure Hash Algorithm-1” (SHA-1) encryption algorithm.

• A “Message Authentication Code” is calculated based on data in the chip’s memory.

• The code calculated by the chip must match the code calculated by the printer for the printer to work.

• Intended by Lexmark to block use of unauthorized toner cartridges.

Lexmark

(6

th

Cir. 2004)

• Lexmark printers perform a second calculation after the “authentication sequence.” • The Printer program downloads a copy of the Toner program from the toner cartridge chip to measure toner levels.

• Before running the Toner Program, the printer runs a “checksum.” – Compares the calculation on the data of the transferred copy of the Toner program with a checksum value located on the chip.

• The two values must match for the printer to work.

Lexmark

(6

th

Cir. 2004)

• Static Control Components (SCC), sells the “SMARTEK” chip that permits consumers to satisfy Lexmark’s authentication sequence.

• SCC advertising boasts that its chip breaks Lexmark’s “secret code” which “even the fastest computer available today . . . would take

Years

to” break.

• SCC sells its chips to third-party remanufacturers, who replace the Lexmark chip in

Prebate

cartridges with the SCC “SMARTEK” chip.

• The recycled Prebate cartridges are sold to consumers as low cost alternatives to new Lexmark toner cartridges.

Lexmark

(6

th

Cir. 2004)

• SCC’s SMARTEK chips contain a copy of Lexmark’s “Toner Loading Program.” • SCC admits that it “slavishly copied” the Toner Loading Program “in the exact format and order” found on Lexmark Prebate cartridge chips.

Lexmark

(6

th

Cir. 2004)

• Two copyright statutes were at issue: – The Copyright Act: • has been in effect in various forms since 1790 and protects “original works of authorship.” – The Digital Millennium Copyright Act: • enacted in 1998 and proscribes the sale of products that can be used to “circumvent a technological measure that effectively controls access to a work” protected by the Copyright Act.

Lexmark

(6

th

Cir. 2004)

• Lexmark sued to enjoin sale of SCC’s SAMRTEK chip, claiming: – SCC’s chip copied the Toner Loading Program in violation of the Copyright Act.

– SSC’s chip violated the DMCA by circumventing a technological measure designed to control access to the Toner Loading Program.

– SSC’s chip violated the DMCA by circumventing a technological measure designed to control access to the Printer Engine Program.

Lexmark

(6

th

Cir. 2004)

• District Court (E.D. Ky.): Held that it is likely that Toner Loading Program copying violated the Copyright Act: – Computer programs are protected “literary works.” – The “requisite level of creativity” needed to establish originality “is extremely low.” – The Toner program could be written in multiple ways.

– The program was not a “lock out code” whose elements are dictated by functional requirements.

• Even if it were a “lock out code,” security systems “are not inherently unprotectable.” – No “fair use”: • commercial purpose, wholesale copying, effect on market.

– No “misuse”: • Lexmark is not using the program “to secure an exclusive right or limited monopoly not expressly granted by copyright law.”

Lexmark

(6

th

Cir. 2004)

• District Court (E.D. Ky.): It is also likely that the DMCA was violated: – SCC circumvented a “technological measure” preventing unauthorized access to a copyrighted work.

– Lexmark’s

authentication sequence

(

not the checksum

) was a “technological measure” that controls access to two copyrighted works.

– It controls a consumer’s ability to use the two programs.

– Circumvention was the “sole commercial purpose” of the SMARTEK chips.

• In fact, SCC openly marketed the chips for this purpose.

Lexmark

(6

th

Cir. 2004)

• District Court (E.D. Ky.): – The DMCA’s “reverse engineering” exception did not apply.

– Under the exception, circumvention devices may be produced and made available “solely for the purpose of enabling interoperability of an independently created program with other programs.” – SCC’s SMARTEK chips are not “independently created” computer programs.

– Directly copied Lexmark’s programs.

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: The parties agreed that: – Computer programs (both source and object code) can be protected “literary works.” – Registration constitutes

prima facie

evidence of copyright validity.

– SCC had the burden of rebutting validity.

– Only “original” works are protectable: • The work must be independently created.

• The work must possess “at least some minimal degree of creativity.” • The “threshold showing of originality is not a demanding one” – “even a slight amount will suffice.” (

Feist

(US 1991))

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: Separation of “ideas” from “expression”: – The task of separating “idea” from “expression” in connection with computer programs “is a

vexing

one.” – In ascertaining this “

elusive boundary line

” courts look to two doctrines: • •

Merger Scenes a faire

–

Merger:

• The “expression is essential to the statement of the idea,” or • “There is only one way or very few ways of expressing the idea.” –

Scenes a faire

: • “External factors” which “constrain the choice of expressive vehicle.” • In the computer programming context, “the elements of a program dictated by practical realities –

e.g.

, by hardware standards and mechanical specifications, software standards and compatibility requirements, computer manufacturer design standards, target industry practices, and standard computer programming practices.”

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: Copyright Act violation not shown to be likely: –

First

, district court erred by refusing to consider whether “external factors such as compatibility requirements, industry standards and efficiency” limited the ways to write the Toner program.

•

Scenes a faire

doctrine directed to the “originality” aspect of copyrightability, not the “substantial similarity” test for infringement.

– The “originality” requirement is not satisfied merely because there are other ways of writing a program.

– The proper inquiry: • whether alternative ways are “

feasible” under the particular facts

.

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: Copyright Act violation not shown to be likely: –

Second

, the district court needs to determine whether the ideas, methods of operation and facts of the Toner program could have been expressed in any other form.

– Must take into account the “functionality, compatibility and efficiency demanded of the program.” – The expert evidence showed that “functionality and efficient considerations precluded material changes,”

e.g.

,: • The Printer program understands only a single language “composed of eight simple commands.” • The program “must consist of only 55 bytes.” • The program is a “no-thought translation of the formulas to the language that the internal loading program must be written in, and [the programmer doesn’t] have much choice.” – The “originality” of the Toner program “may be

de minimis.

”

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: Copyright Act violation not shown to be likely: –

Third

, the district court erred in assessing whether the Toner program functions as a “lock out code”: • The fact that the code functions as such undermines a contrary conclusion.

• Altering a single byte in the program will result in the checksum not matching.

• Expert testimony showed that discovering and encoding the correct checksum on the SCC chip would have been “

computationally impossible

.” • The checksum “imposes a compatibility constraint in the most literal sense possible” – “if any single byte of the Toner Loading Program is altered, the printer will not function.” – “On this record, pure compatibility requirements justified SCC’s copying.”

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: “Fair use.” – First factor: “

commercial purpose

” • The issue is whether the user stands to profit from exploiting the “copyrighted material.” – SCC did not seek to unjustly benefit from creative energy devoted by Lexmark to the Toner program.

– SCC did not use the Toner program to calculate toner levels.

– The SMARTEK chip used the program’s data bytes as input to the checksum to permit printer functionality.

– Fourth factor: “

market effect

” • The issue is the impact on the market for the copyrighted work itself.

• The District Court incorrectly focused on the market for toner cartridges.

• Correct focus is on the

market for the Toner program

.

• Unlikely there is a market for a program “as elementary” as the Toner program.

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: The Court rejected other Lexmark Copyright Act arguments: – Use of Lexmark’s stock symbol, “LXK,” in the Toner program is functional since it serves as an input to the checksum.

– The uncopyrightablity of the Toner program is not the death knell of computer program copyrightability since most programs do not simultaneously operate as a “lock out.” • Code that functions as a “lock out” (no feasible alternatives available) is not protectable. This an expert issue.

– Short programs may still be copyrightable if they “reveal

high levels of creativity

” and present “

simple, yet unique solutions

to programming quandaries.” – “But, unless a

unique creative flair

is shown, a very brief program is less likely to be copyrightable because it affords fewer opportunities for original expression.”

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: The DMCA: – Enacted to implement the WIPO Copyright treaty.

– Concerned with the threat of “massive piracy” of digital works due to ease with which they can be copied and distributed worldwide.

– Copyrighted works likely to be encrypted and made available to consumers upon payment for access.

– DMCA directed at stopping those who decrypt the protective codes or provide others with devices to do so.

– DMCA backs with legal sanctions “the efforts of copyright owners to protect their works from piracy behind digital walls such as encryption codes or password protections.”

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: The DMCA: – Three liability provisions: •

First

prohibits circumvention of “a technological measure that effectively controls access to a work protected by a copyright.” •

Second

prohibits selling devices that circumvent access-control measures: –

“primarily designed or produced for the purpose of circumventing”

– –

“only limited commercially significant purpose or use other than to circumvent” marketed “for use in circumventing”

•

Third

prohibits devices aimed at circumventing tech measures that allow some forms of “access” but restrict other uses of the copyrighted work: –

E.g.

, streaming media, which permits users to view a copyrighted work but prevents downloads.

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: The DMCA: – Three “reverse engineering” defenses: • •

First,

access control measures can be circumvented “for the sole purpose of identifying and analyzing those elements of the program that are necessary to achieve interoperability of an independently created computer program with other programs . . .”

Second,

a person “may develop and employ technological means” that are “necessary” to enable interoperability.

•

Third

, the above technological means may be made available to others “solely for the purpose of enabling interoperability of an independently created computer program with other programs.” – Inapplicable if there is “traditional” copyright infringement.

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: DMCA violations not shown to be likely with respect to the Printer program: – Parties agreed that the program was copyrightable.

– The “authentication sequence” is not what “controls access” to the program: • Purchase of a Lexmark printer allows access to the program.

• Anyone who purchases a printer may read the code directly from memory “with or without benefit of the authentication sequence.” • No security device protects access to the Printer code and no security device must be “circumvented” to obtain access to the code.

• The authentication sequence only blocks one form of access.

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: DMCA violations not shown to be likely with respect to the Toner program: – In light of Printer program ruling “we can dispose quickly” of Lexmark’s Toner program claim.

– The SCC SMARTEK chip does not provide “access” to the Toner program.

– It replaces the program.

– Also, to the extent that the Toner program is not a copyrightable “work,” it is not protected by the DMCA.

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: DMCA violations not shown to be likely with respect to the Toner program: – Further consideration of SCC’s “interoperability” defense is also required: • The SMARTEK chip

might qualify

as an “independently created computer program” since it

includes functionality beyond the Toner program data on the Lexmark chip

.

• The SMARTEK chip might therefore serve purposes other than merely circumventing Lexmark’s authentication sequence.

• The chip might qualify as “enabling interoperability of an independently created computer program with other programs.”

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: Concurrence of Judge Merritt: – “We should make clear that in the future companies like Lexmark cannot use the DMCA in conjunction with copyright law to create monopolies in manufactured goods for themselves just by tweaking the facts of this case: by, for example, creating a Toner Loading Program that is more complex and ‘creative’ than the one here, or by cutting off other access to the Printer Loading Program.” – “The crucial point is that the DMCA forbids anyone from trafficking in any technology that ‘is primarily designed or produced for the purpose of circumventing a technological measure that effectively controls access to a [protected] work.’”

Lexmark

(6

th

Cir. 2004)

• Sixth Circuit: Judge Merritt concurring: – SCC’s microchip “is not intended to reap any benefit from the Toner Loading Program – SCC’s microchip is not designed to measure toner levels – but only for the purpose of making SCC’s competing toner cartridges work with printers manufactured by Lexmark.” – “If we were to adopt Lexmark’s reading of the statute, manufacturers could potentially create monopolies for replacement parts simply by using similar, but more creative, lock-out codes. Automobile manufacturers, for example, could control the entire market of replacement parts for their vehicles by including lock-out chips.” – “Congress did not intend to allow the DMCA to be used offensively in this manner, but rather only sought to reach those who circumvented protective measures ‘for the purpose’ of pirating works protected by the copyright statute.”

Sony v. Divineo

(N.D. Cal. 9/11/06)

• The lawsuit involved several technologies that thwart the authentication protocol used by the Sony PlayStation and PlayStation 2 video game consoles to validate that a game inserted into the player is a legitimate copy.

• To confirm the CD-ROM's authenticity, the console searches for a unique code that cannot be copied when the disk is duplicated. If the console fails to find that code, it will not play the game.

• Divineo Inc. distributed a trio of work-around technologies to address this problem.

Sony v. Divineo

(N.D. Cal. 9/11/06)

• Divineo Inc. distributed a trio of work around technologies to address this problem: – “HDLoader,” an external hard drive that could be connected to the PlayStation. It enabled users to copy an original game to the HDLoader drive instead of the PlayStation's internal hard drive. Thereafter, the game could be directly accessed from the external hard drive without going through the security check. In theory, this would allow an unscrupulous gamer the opportunity to further copy the game from one hard drive to another while preserving playability.

– “Mod chips" that could be wired into the PlayStation and had the effect of bypassing the authentication process. – “Swap Magic,” disc which contained the security code taken from an original PlayStation game. Once the console reads that code from the Swap Magic disc, the user can then swap that disc out and insert the bootleg copy of the game to play it.

Sony v. Divineo

(N.D. Cal. 9/11/06)

• Defendants argued that the products served non-infringing purposes: – allowing users to play lawfully purchased imported games hobbled by region-coding restrictions, or – enabling users to play home-brew games on their consoles. • The court granted Sony's motion for summary judgment, awarded enhanced statutory damages of $3.75 million, attorneys' fees and costs, and permanently enjoined the defendants from distributing the devices.

• Where the device is primarily designed to circumvent a video game console's anti piracy technology, other uses of the device for non-infringing purposes have no bearing on the distributor's liability for trafficking in circumvention devices in violation of the DMCA

DMCA “Safe Harbor”

17 U.S.C.

§

512

“Service providers” are exempt from liability for “transmitting, routing, or providing connections for, material through a system or network controlled or operated by or for the service provider, or by reason of the intermediate and transient storage of that material in the course of such transmitting, routing, or providing connections,” if: • (1) the transmission of the material was initiated by or at the direction of a person other than the service provider; • (2) the transmission, routing, provision of connections, or storage is carried out through an automatic technical process without selection of the material by the service provider; • (3) the service provider does not select the recipients of the material except as an automatic response to the request of another person; • (4) no copy of the material made by the service provider in the course of such intermediate or transient storage is maintained on the system or network in a manner ordinarily accessible to anyone other than anticipated recipients, and no such copy is maintained on the system or network in a manner ordinarily accessible to such anticipated recipients for a longer period than is reasonably necessary for the transmission, routing, or provision of connections; and • (5) the material is transmitted through the system or network without modification of its content.

Tur v. YouTube

(C.D. Cal. 2006)

• Copyright suit brought in July 2006 by Los Angeles News Service owner Robert Tur over several videos he alleges appeared on YouTube without his permission.

• Tur alleges that YouTube caused the infringement of his copyrighted footage of the Rodney King riots in Los Angeles.

• Tur relies on the Supreme Court's

Grokster

decision that technology services can be held liable for inducing infringement.

• YouTube responds that it is protected by the DMCA "safe harbor,“ claiming that it has met the requirements for this exemption which include responding to notices of infringing material, and acting quickly to remove the infringing material.

UMG v. MySpace

(C.D. Cal. 2006)

• Universal Music Group filed a copyright infringement suit against MySpace on November 20, 2006, in federal court in Los Angeles • UMG accuses MySpace of using “extensive efforts to encourage members to upload pirated videos to MySpace servers.” • UMG claims that MySpace and its parent, News Corp., have “made infringement free and easy, turning MySpace videos into a vast virtual warehouse for pirated copies of music videos and songs.”

UMG v. MySpace

(C.D. Cal. 2006)

• MySpace argues that it does not induce, encourage or otherwise condone copyright infringement.

• It also claims to have taken proactive steps to filter unauthorized sound recordings.

• Myspace also claims that it is protected by the DMCA "safe harbor" provisions.

• “We are in full compliance with the [DMCA] and have no doubt we will prevail in court.” • UMG previously settled a similar lawsuit against YouTube (revenue sharing).