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The Unsinkable RIAA v. Napster
Not since the early days of U.S. v. Microsoft has a lawsuit in the technology industry been as closely watched as that of Recording Industry Association of America v. Napster.
Just as many looked to the Microsoft case as a bellwether for antitrust law in the digital age — a viewpoint reinforced when U.S. District Judge Thomas Penfield Jackson ruled against the software giant — the Napster case is seen as a key marker for copyright law on the Internet.
The case, which goes before U.S. District Judge Marilyn Patel in San Francisco on Wednesday, already has attracted the attention of journalists and big-name lawyers. In one corner of the courtroom will be the former Justice Department Microsoft-slayer David Boies, recently hired as lead counsel for Napster. He will square off against a battery of attorneys at the RIAA, which recently has sued an array of Web sites including MP3.com, MP3Board.com and Scour.com; in the latter case, RIAA is represented by David Kendall, best known as President Clinton’s personal attorney.
As in the Microsoft case, the Senate Judiciary Committee has been anxious to weigh in on the matter before it headed to court. Indeed, in a star-studded hearing two weeks ago, Napster CEO Hank Barry faced off with Lars Ulrich, drummer and co-founder of Metallica, one of the company's sworn enemies — which has his own, separate lawsuit against the company. The differences of opinion between Barry and Ulrich were aired before Chairman Orrin Hatch, R-UT, ranking member Patrick Leahy, D-VT, and Sen. Dianne Feinstein, D-CA, who came forward with their own perspectives on the matter.
Although Feinstein grilled Barry on Napster's technology, which she said "entirely defeats the purpose of copyright protection," the hearing's key surprise was that Hatch and Leahy — both music fans — had such harsh words for the recording industry. Hatch blamed the recording industry for failing to license its music to key music Web sites. And both he and Leahy said they were disappointed that their 1998 Digital Millennium Copyright Act (DMCA) had not stimulated such activity — while adding that they may have to step in to do so.
While such sentiments may have been music — at least of the figurative kind — to Web sites' ears, the legislators’ statements will likely be of little help to Napster in its upcoming legal battle.
Service Provider or Contributory Infringer?
At the root of the controversy is a technology developed by Northeastern University dropout Shawn Fanning, combining Internet relay chat (IRC) with the file transfer protocol (FTP). IRC permits an Internet user to send instant messages to anyone else who is logged on at the same time, while FTP is the standard for uploading and downloading files to the Internet.
Unlike the first wave of Web sites that posted high-quality recorded music in the MP3 file format on their servers, the beauty of Napster is that it merely connects users to each other. Users then "share" their own MP3 files — and they have been doing it in droves. The service has grown rapidly over the past four months, and now has more than 20 million users — almost matching industry giants like America Online.
From a copyright-enforcement point of view, it’s a lot more difficult to stop Napster because there are no infringing files on their servers. (Previously, when copyrighted MP3 files went online, a terse legal letter from RIAA would usually prompt the user to remove the files.) With Napster's technology, any potentially illegal file sharing takes place directly between users — permitting Napster to avoid direct claims of copyright infringement that prompted a judge to rule against MP3.com. In a move related to that legal battle, MP3Board Tuesday unveiled a new technology dubbed LinkBlaster that allows the owners of music copyrights to review the links to music files and Web pages found on the MP3Board database and to remove links to infringing works.
For the recording industry, that shouldn't mean that Napster gets off the hook. "We have not alleged direct infringement by Napster," said Russell Frackman, RIAA's lead outside counsel, and an attorney with Mitchell Silberberg & Knupp in Los Angeles. "We are arguing contributory infringement, which requires an actual or constructive knowledge and a contribution to the infringement, and vicarious liability, which requires the ability to control or supervise the infringed conduct and a financial benefit" from any copyright infringement. In other words, Napster is contributing to infringement, and the company could stop it if it wanted to.
Napster already has lost round one of a legal battle when the company attempted to have the charge dismissed on the grounds that company qualified for one of the DMCA's exemption for Internet service providers. The law, which was designed to strike a balance between copyright holders and ISPs that didn't want to be held liable for copyright infringement by their users, granted four safe harbors under the following subsection of the act's section 512: a) if businesses can prove they are merely a conduit for information;
In May, Judge Patel ruled that Napster did not qualify for the exemption under "subsection a," which it might have met if it had transmitted or routed material, much like Bell Atlantic or America Online. Although Patel didn't address whether Napster might still qualify under "subsection d", her comments raised questions about Napster's commitment to kicking known copyright infringers off its system, and hence, the company's eligibility to receive such an exemption.
Cutting Across Political Lines
While not explicitly defending Napster in the Judiciary Committee, Hatch's questions of RIAA President Hilary Rosen pressed many of the same points made by Napster legal counsel Boies. On the other hand, Democrats who traditionally had been allied with the recording industry have been among the harshest in their invective against Napster. Among the few public policy groups that have taken an aggressive stance against Napster is the Democratic Leadership Council's Progressive Policy Institute (PPI). PPI argues that unless the service is dramatically retooled, it may have to be shut down.
"The reason we thought this was an important issue is that there is this strain of cyber-libertarianism out there that has permeated up to elected officials," said Rob Atkinson, director of the PPI's New Economy Task Force. "It is this notion that the old rules don't apply. We don't have to obey laws. That is completely wrong, that is not what this is about."
But while PPI has called for new laws to deal with threats like Napster, freshman Rep. Anthony Weiner, D-NY, applauded Congress for holding back. "Our first instinct in Congress should be to have technology solutions to technology problems," said Weiner, who also has advocated a laissez-faire policy with respect to Internet privacy and gambling. "In order for Congress to set ground rules [on copyright], the ground needs to stop shifting."
Leading the rallying cry against RIAA and the Motion Picture Association of America — which also has been engaged in serial lawsuits against computer hackers and their Web sites — is the Electronic Frontier Foundation, which recently has stepped up its Campaign for Audiovisual Freedom as a counterbalance to interests of copyright holders. Among the campaign's key tenets are that individuals have a right to use technology to "shift time and space" much as a videocassette recorder permits consumers to tape copyrighted television programs for later viewing.
Meanwhile, traditional free market think tanks are sorting out their own conflicts. "I think the conservatives are really struggling with this issue," said Scott Rayder, senior technology policy analyst at the Heritage Foundation. "Some see it as a property rights issue, that basis of conservatism. Others take the free-market/libertarian approach that if it is on the Web, it should be free."
"My sympathies are with the position that companies that manufacture technology should not be held liable for the way it is used, any more than photocopy manufacturers should be held liable for the way their product is used," said Solveig Singleton, director of information studies for the Cato Institute.
What's Fair About 'Fair Use'?
By pointing to the photocopy machine analogy, Singleton raises another key point that Napster devotees make: just because some people use the service to infringe on copyrights doesn't mean that all people do. Boies' July 3 brief relies upon the Supreme Court's decision in Sony of America v. Universal Studios to make this point: "Under the seminal Sony case, as long as a technology is 'capable of substantial non-infringing uses,' a provider making a technology available cannot be held liable for copyright infringement, even where it may have encouraged infringing uses and the technology may in fact have been used for infringing activity."
Napster's other key defense — also articulated by Barry in the Judiciary Committee hearings — is that Napster users are not infringing; rather, they are making "fair use" of copyrighted material that is explicitly authorized by the Audio Home Recording Act of 1992. Under that act, which the 9th Circuit Court of Appeals relied upon in deciding against RIAA in its case 1999 lawsuit against Diamond Multimedia's Rio player, consumers have what Boies called "an absolute right to create and transfer digital music for non-commercial purposes."
How well Napster can sustain that argument in federal court remains to be seen. But the impact of the decision seems certain to reverberate of Capitol Hill and in the tech industry for many years to come.
 | - by Drew Clark |
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