Status
After a long battle against this bill, including the tech industry, consumer groups, libraries and a grassroots effort, this bill appears to be dead. The opposing side has filed to have the Supreme Court review the MGM et al. v. Grokster et al. case.
Summary
The “Inducing Infringement of Copyright Act of 2004” (S.2560) is a measure aimed at reversing a federal district court decision in the Ninth Circuit called MGM et al. v. Grokster et al. (“the Grokster case”). In that case, the district court concluded that Grokster, a distributor of peer-to-peer file-sharing software, was not liable for “contributory” or “vicarious” copyright infringement.
The bill’s sponsors are concerned that this case (now on appeal in the Ninth Circuit) “opens the door” to people developing and/or selling devices or other technologies and services that make infringement easy (or even possible). The bill would add a new section to the Copyright Act that would make “inducing” copyright infringement an offense under the Act, and that would not be subject to the same defenses that Grokster was able to use in its case.
Analysis
The problem here is that this response to Grokster sweeps far more broadly than its sponsors recognize or admit.
First, the bill creates a new doctrine of “intentional inducement of infringement” whose meaning is deliberately different from “contributory” or “vicarious” infringement. That means that our understanding of what is will make us liable under copyright law has to start over at square one.
Second, the defenses against liability under “contributory” or “vicarious” infringement don’t apply if one is accused of “inducing” infringement. Under existing law, if you have no reason to know about a specific instance of infringement, you’re not liable for contributory infringement. (That’s why the use of “intentional” in the bill’s title is misleading, since the bill expressly allows courts to find “intent” based on what a “reasonable person” would be expected to know, rather than on what the defendant actually knew or should have known.) Furthermore, under existing law you’re not liable for vicarious infringement if the infringer is a person who’s not under your supervision or control.
This is why Sony can continue to sell VCRs, TiVo can sell digital TV recorders, and Apple can sell iPods, even though some subset of the users of these devices can use them to infringe. If you are a maker or distributor of such technologies and don’t intend or have reason to know that an infringement is taking place, current copyright law doesn’t make you liable for contributory infringement. And if you’re not supervising or controlling the person who’s doing the infringing, you’re not liable for vicarious infringement.
This bill, however, would make you liable, as a maker or distributor of technologies or services (including telecommunications and Internet services) that someone used to infringe, regardless of what you intended, what you had reason to know, or who was under your control.
In effect, by seeking to overrule the Grokster case, the bill poses the risk of overruling Sony Corp. v. Universal City Studios (1984), the Supreme Court case that determined that VCRs, and other technologies with “substantial noninfringing uses” are presumptively legal.
This bill, if enacted into law, puts technology creators and users on notice that they may face liability even if they neither intended to cause copyright infringement nor had reason to know about actual infringement. It’s also broadly written enough to put those who invest in such technologies on notice that they might face liability too (not to mention losing their investments if the technologies they invest in are declared illegal).
