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Where Commerce, Culture and the First Amendment Collide - The Napster Case
The Legal Debate

When Shawn Fanning created Napster, he did not think about the ethical or legal implications of his work. He just wanted to build a system that provides easy access to MP3 files. However, the simplicity and scale of the system soon let the music industry frown heavily upon him. The Recording Industry Association of America (RIAA) sued Napster for tributary copyright infringement, i.e. facilitating other people's infringement of copyright.

Napster's attorney David Boies argues that the users are not really infringing any copyrights because all the copying is noncommercial since users don't charge each other for downloads: "[...] this kind of noncommercial consumer copying is recognized as fair use under common-law theories and doctrines [...]. And second, [...] the Audio Home Recording Act directly says that noncommmercial copying by consumers is lawful." [JH00] However, the RIAA holds that there is a difference between a consumer making a copy for his personal use (e.g. a compilation of favorite songs to play in the car), and making it available on the Internet where it can be freely downloaded by anyone. The Audio Home Recording Act (AHRA) [AHRA92] cited by Boies gives manufacturers of digital music recording devices some protection from contributory copyright infringement claims - but only if they register with the Copyright Office, pay a statutory royalty on each device and medium sold, and implement serial copy management technologies (1). However, multipurpose devices, such as general computers or CD-ROM drives, are not covered by the AHRA, as the RIAA points out. While this means that their manufacturers don't have to pay royalties, they are also not immune from suits for copyright infringement. Additionally, the RIAA argues that it is not relevant that Napster's users act noncommercially. They cite the No Electronic Theft (NET) Act [NET97] which criminalizes electronic copyright infringements if there is a possibility of financial loss to the copyright holder or financial gain to the infringer. Since the NET Act defines "financial gain" as the receipt of anything of value, including the receipt of other copyrighted works, it would constitute a copyright infringement for users to make their files available through Napster and expect to receive files from other users in return.

The question then is if Napster can be held responsible if some (or even many) users engage in copyright infringement. Boies maintains that Napster services many users who don't infringe any copyrights - for example, by sharing songs from the 25,000 artists who have given permission to have their songs traded on Napster, by distributing music that is not copyrighted, whose copyright has expired or whose copyright owners don't object, or by using the service for "space-shifting", i.e. downloading songs they already own on CD to more portable media such as Diamond Multimedia Systems' Rio MP3 player. The RIAA argues that only a small percentage of Napster's users actually engage in non-infringing copying while most of them use the service for copyright violations. Boies counters with the 1984 Supreme Court's decision in the case of Sony vs. Universal Studios, which ruled that "even though [Sony's] VCRs were predominantly used to copy copyrighted materials, because there were substantial uses that did not infringe copyrights [...] you could not find that Sony was guilty of contributory or vicarious infringement." So, according to Boies, it is not relevant what the predominant use of a technology is, but only if it's capable of supporting substantial noninfringing uses - which Napster is.

So, what about the users actually using Napster for copyright infringements? Boies feels Napster is covered by the Digital Millenium Copyright Act [DMCA98], which says that Internet Service Providers (ISPs) have to disable a user's account if they know that this user is using the account for illegal activities. However, the DMCA does not require ISPs to monitor the activities of each and every user, even if they know that some users are engaged in unlawful activities. Indeed, Napster disabled the accounts of about 350,000 users when the band Metallica alleged that those users were distributing their copyrighted songs. While the RIAA acknowledges that Napster complies with the DMCA today, it frets that "A few words cannot undo the harm caused by millions of Napster users unlawfully downloading tens of millions of infringing music files" [RIAA00].

Here it becomes clear that one of the pivotal points in the arguments of both Napster and the RIAA is scale: The RIAA holds that "there is a big difference between a consumer making a copy for his or her personal use, and that same consumer making the file available on Napster where it can be freely downloaded by millions of people. [...] At any single point in time, millions of users may be logged onto Napster trading millions of pirated sound recordings." [RIAA00] Boies tries to put those numbers into perspective by arguing that while the total amount of sharing is large, the number of copies made of any individual file is considerably smaller: "[...] if you have 25 million users, each with 10 files, that's 250 million files. If 250 million files are downloaded twice, that's 500 million downloads. But each user has shared a file only twice," he says, suggesting that this is not different from what people have been doing with their CDs for years. But while he maintains that Congress authorized digital copying in the AHRA, and the AHRA does not contain any restrictions on scale, he acknowledges that "the Internet could permit noncommercial consumer copying on a scale Congress did not contemplate." [JH00]

Boies is convinced that the RIAA's members - the big media companies and record labels - joined forces in order to shut Napster down and take over its technology, thereby not only misusing their copyrights for anticompetitive purposes, but also violating the First Amendment rights of Napster and its users: "Napster has the right to provide an index, a directory. [...] The courts have held that directory publishers enjoy free-speech rights." [JH00]. The RIAA, however, rejects this argument forcefully, saying that the First Amendment does not grant a right to infringe copyrighted works. The media companies also state that they have no intention of shutting Napster down or banning the MP3 format, but are only asking to stop the unauthorized distribution of music: "Our experts and theirs agree that it's technically possible to create a file sharing system that only indexes or allows searches for artists or songs that have been authorized. But the burden is on Napster to figure out how to operate legally [...]" [RIAA00]

  1. A technology that prevents users from making copies of copies. The Serial Copy Management System (SCMS) implemented in Digital Audio Tape recorders allows users to make one digital copy of an original tape, but no digital copies of that copy. (back)

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