ArtsWatch: Industry Wins Summary Judgment Against LimeWire

Court victory raises hopes that commercial file-sharing will fade
May 17, 2010 -- 10:16 am PDT
By Philip Merrill / GRAMMY.com

The Recording Academy actively represents the music community on such issues as intellectual property rights, music piracy, archiving and preservation, and censorship concerns. In pursuing its commitment to addressing these and other issues, The Recording Academy undertakes a variety of national initiatives. ArtsWatch is a key part of an agenda aimed at raising public awareness of and support for the rights of artists. To become more involved, visit Advocacy Action @ GRAMMY.com and sign up for Advocacy Action E-lerts.

On May 11 New York's U.S. District Court Judge Kimba Wood granted music labels' motion for summary judgment against file-sharing service LimeWire, finding the defendant guilty of inducing copyright infringement, vicarious copyright infringement and unfair business practices. A hearing in the case is set for June 1. RIAA Chairman/CEO Mitch Bainwol said, "By finding LimeWire's CEO personally liable, in addition to his company, the court has sent a clear signal to those who think they can devise and profit from a piracy scheme that will escape accountability." The Copyright Alliance expressed relief and consumer advocates Public Knowledge expressed concern about the outcome of the case, originally filed in 2006. LimeWire stayed with the commercial file-sharing business model after past RIAA court victories cleared away many of its competitors — leaving it in a dominant but questionable position. LimeWire will undoubtedly fight vigorously for that position on June 1.

The appeals process for last year's court victory in Sweden against torrent-linking site the Pirate Bay cleared a major hurdle on May 12 with Sweden's Supreme Court ruling that the Svea Court of Appeals judges scheduled to hear the case in September are free of bias. The defendants' appeal suggested that attorneys' membership in intellectual property law associations should disqualify them as having a conflict of interest on behalf of copyright owners. The Pirate Bay is still online, several defendants have insisted they won't pay any of the multimillion dollar damages awarded, and the September court date could be further delayed because one of the four defendants claims he is unable to attend at that time.

CBS and Fox have rejoined the National Association of Broadcasters, as announced on May 10. NAB President/CEO Gordon Smith said, "Both CBS and Fox currently have superb advocacy arms in Washington. We are delighted by their vote of confidence in the NAB team, and we look forward to presenting a seamless display of broadcast unity inside the Beltway." Fox departed NAB in 1999 and CBS left in 2001 after divisions arose over the issue of a cap on national station ownership. NAB's reunified television membership now includes the four majors, as well as ION Media Networks, Telemundo, and Univision.

On May 7 the Federal Communications Commission Media Bureau granted MPAA a limited waiver of the prohibition on selectable output control (SOC) to encourage an early home release window for theatrical features not yet on DVD. The Media Bureau's opinion reveals the agile balancing act the FCC is trying to perform, disagreeing in part with seemingly all of the public comments submitted while pursuing innovation-friendly policies that date back to the 2003 prohibition on SOC. Public Knowledge has been a leader among consumer advocates wanting to keep the prohibition in place. President and co-founder Gigi B. Sohn said, "The order allowing the use of [SOC] will allow the big firms for the first time to take control of a consumer's TV set or set-top box, blocking viewing of a TV program or motion picture." The order is meant to block only analog outputs that can be easily used for illegal copying and contains a review process to ensure that future details don't evade the spirit of the waiver. MPAA President/Interim CEO Bob Pisano said, "We deeply appreciate the recognition by the FCC that recently released movies need special protection against content theft when they are distributed to home televisions." It is understandable that the MPAA treats this order as a win, but the details entail comprehensive FCC supervision including the threat of revoking its carefully conditioned permission.

Last week's ArtsWatch covered the FCC's proposal to move Internet transmission into the category of a telecommunications service, giving the agency increased statutory authority to regulate Net neutrality and other open Internet principles. Reactions for and against this proposal have mostly been clumsy, and it turns out the initial impetus for this approach came from a dissent written by U.S. Supreme Court Justice Antonin Scalia. Pro-Net neutrality forces stumbled when they clamored against what was thought to be a telecom industry PowerPoint presentation attacking the FCC's move but was revealed to be a class project that had placed third in an online contest. On May 11 Rep. Cliff Stearns (R-Fla.) introduced a bill designed to slow down the FCC's move, but coverage of its text showed it was hardly a focused tool to accomplish the job. Meanwhile Broadcasting & Cable called attention to a much overlooked key feature in the legal thinking underlying the FCC's proposal to subject broadband transmission to separate treatment — the idea was first put forth by Scalia. That could be very convenient considering that the Supreme Court ultimately has the authority to strike down the FCC's new approach.

Register of Copyrights Marybeth Peters wrote an April 30 opinion on a novel issue of copyright law, which was published in the Federal Register on May 11. Copyright Royalty Judge William J. Roberts Jr. asked whether either Peters or the Copyright Royalty Board had the authority to determine that Copyright Act provisions were unconstitutional. Peters analyzed the exceptions to the general prohibition against agencies reaching determinations on constitutionality of statutes and, after finding that none of them applied, concluded that no such authority exists.

On May 10 United Nations organizations ITU and UNESCO announced the formation of a Broadband Commission for Digital Development. The commission will meet mid-year in Geneva and issue two reports by September, one drawn directly from commissioner input and another providing a high-level analysis of economic benefits and technological alternatives.

 

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