The Supreme Court strikes again with another bad decision. Earlier today the Supreme Court ruled that companies that make software that can be used to share digital media may be held accountable if a customer uses the software to distribute or acquire copyright protected intellectual property. It’s not immediately clear whether or not this ruling overturns the 1984 Sony Betamax ruling, which protects hardware that may be used to duplicate intellectual property, but this ruling does severely restrict future development of software.
This ruling creates an unfair situation where companies are forced to assume responsibility for the actions of their customers. This would have never happened if software wasn’t an abstract product that cannot be held in a person’s hand. Imagine if this case was about hammers. A hammer has a purpose, but may be used improperly. Should the manufacturer of the hammer be responsible if a customer uses the hammer to kill or damage property? This ruling is obviously the result of heavily financed lobbying by the RIAA and MPAA.
The RIAA has been leading the march to destroy technology that can share digital media. They claim they lose a substantial amount of income due to filesharing. That’s an outright lie. Two independent university researchers performed a 17 week study in 2002 and concluded that filesharing not only does not inflict loss on the recording industry, but actually increases sales. The RIAA study which has been used to lobby the government promotes the false basis that every downloaded song would have been purchased had it not been available for free on the internet. The fact is a majority of people that download would not have purchased the music. Most users are sampling music, much like listening to the radio or lack the luxury income to purchase all the music they would like to have.
The music industry as a whole has seen a reduction in sales, but that is a deceiving figure. Music companies are offering fewer albums, less variety and releasing more products that receive poor or moderate reviews. Bad business and marketing decisions are undermining their sales more than any other factor. This past decade the music industry has focused on selling music that sounds so similar to a selection from another artist, that many consumers didn’t bother purchasing the product. I believe the music industry also made a terrible mistake by focusing more on the boy band and teen diva pop genre and failing to offer adequate variety for consumers outside of the teen or young adult demographics.
The people and artists need to stand up and send a message to the media companies. The only reason entertainment media is so overpriced and artists receive such a small percentage is because the media companies take an unreasonable share of the profits. As a consumer, you need to modify your purchasing habits. Buy your music directly from the artists when possible or purchase music only from record labels that are not RIAA members. This does mean you won’t be buying the latest album from Britney Spears or Coldplay, but is that really such a loss? There are literally hundreds of artists out there that aren’t owned by the RIAA that can fill their shoes.
Some of the recent Supreme Court rulings leave me a bit baffled — and more than a bit disappointed. It seems the Court is choosing to be indecisive on some of the issues before it, and letting the lower courts sort out the mess. At the same time, the High Court is striking one blow after another against the average citizen.
In Grokster, the Supreme Court ordered the case “reversed and remanded,” stating that Grokster may be liable for contributory infringement, but remanding the case to the lower courts for final decision. What a cop-out. They had an opprtunity to make a clear-cut decision and they passed on it. The only thing the Supreme Court did was apply a slightly different analysis to the case - a so-called “active inducement” test. This active inducement standard requires a plaintiff (read: the RIAA/MPAA) to demonstrate that the defendant encouraged (or failed to effectively deter) acts of infringement in the uses of its products. In other words, that a P2P developer had intended, or at least reason to believe, that his creation could be used as a vehicle for infringement. This will no doubt create a chilling effect on technology developers, who must now be constantly vigilant of possible infringing uses for their products. Technology companies, already fearful of litigation, now have something new to worry about. At best, this decision will add time and cost to product development. At worst, it could deter or even snuff out certain innovations.
I do believe that the ruling leaves the 1984 Betamax decision intact for the most part, and that a defendant still has a reasonably good defense of “substantial non-infringing uses.” The only thing different is that The Entertainment Cartel need only shift its litigation strategy and prove that a P2P developer (or any other similar defendant) has targeted or allowed infringing activities with its product. Only time will tell what the District Court in California will do with Grokster and how it will interpret and apply the Supreme Court’s reasoning.
As to the eminent domain issue (Kelo v. City of New London), the High Court started us down a slippery slope by distorting the 5th Amendment “takings” clause. James Madison must be spinning in his grave right now. Urban planners across the country, who would love to re-gentrify parts of their communities, are thinking of ways to reassign land use to maximize the local tax base. Meanwhile, corporate counsel for big-box stores like Target, Wal-Mart, Best Buy, etc., are likely gearing up for this new means of acquiring land. The Kelo case was not a unique, nor isolated case. Similar cases have been fought in recent years, including one in my state. A couple years ago, Best Buy had the city of Richfield, Minnesota condemn a huge chunk of land along the I-494 corridor, booting a successful auto dealership and numerous residential homes to make way for Best Buy’s shiny new HQ.
Justice Kennedy’s concurring opinion in Kelo, suggesting that some takings might be unconstitutional if premised on “inpermissible favoritism,” offers a tiny bit of hope. But proving such impropriety by a local government would be an uphill battle. The lure of bringing in more tax base to cash-strapped local governments is going to be a powerful force behind this new breed of eminent domain takings.
These are tough times for the American consumer, and the courts are not likely to offer much support to the little guy. Don’t expect much from Congress either - they’re not in the mood for it and the political winds are heavily favoring The Entertainment Cartel. We as consumers need to be more proactive. Stop buying RIAA and MPAA products. This includes video rentals. Support indie films, art and music. If you must buy popular CDs and DVDs, buy them used - the industry makes no money from resales. Try to use more open-source PC applications. Forego the family trip to Disneyland and go explore one of our National Parks instead. Get involved (or be more involved) in local politics and keep a close watch on your local elected officials. Attend local council meetings. Let these officials know in no uncertain terms that you won’t tolerate the kind of property-use bullying recently sanctioned by the Supreme Court.
Sure, in the grand scheme these seem like little things, but if enough people get wise to what is going on, the message becomes more noticeable.
Comment by Kevin Brady — Tuesday 28 June, 2005 @ 21:17