Amicus Curiae Brief — Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd.

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No. 04-480

IN THE OFFICE OF THE CLERK ©

Supreme Court of the United States

METRO-GOLDWYN-MAYER STUDIOS INC., et al.,

Petitioners,

GROKSTER, LTD., et al.,

Respondents.

On Writ or CERTIORARI TO THE

Unitep States Court OF APPEALS FOR THE Nintu Circuit

— ——

Brier Or Amici Curtak Orrice Or Tue Commissioner Or BASEBALL,

NATIONAL BASKETBALL ASSOCIATION, NATIONAL FoorBaLt LeaGcue,

PROFESSIONAL PHOTOGRAPHERS OF AMERICA, INC., AMERICAN SOCIETY

Or Mepia Puorocraruers, Inc., ASSOCIATION Or AMERICAN

Pusiisuers, Inc., ASSOCIATION OF AMERICAN UNiverRSITY PRESSES,

Propucers Guitp Or America, Inc., Grapnic Artists GuiLp,

ENTERTAINMENT SOFTWARE ASSOCIATION, THe AUTHORS GuiILp, INc.,

AND Tue INDEPENDENT Fitm & TELEVISION ALLIANCE

IN SuPPORT OF Petirioners

— —_———

Ropert ALAN GARRETT

Counsel of Record

Gary GERTZOG HaApRIAN R. Katz

Senior Vice President of Business Steven R. ENGLUND

Affairs and General Counsel Micuece J. Woops

NATIONAL FooTBALL LEAGUE CHRISTOPHER WINTERS

280 Park Avenue ARNOLD & Porter LLP

New York, NY 10017 555 12th Street, N.W.

(212) 450-2000 Washington, D.C. 20004

Counsel for Amicus (202) 942-5000

National Football League Counsel for Other Amici

192262 g

COUNSEL PRESS

(800) 274-3321 + (B00) 359-6859

TABLE OF CONTENTS

TABLE OF CITED AUTHORITIES ............

INTERESTS OF AMICI CURIAE ..............

SUMMARY OF ARGUMENT .................

NPE E vet ovaddanccksrseecusdbcavineasy

Il.

The Decision Below, If Allowed To Stand,

Will Burden The Judicial System With

Multiple Individual Infringement Actions

And Will Deprive Copyright Owners Of A

Meaningful Remedy For Millions Of Acts Of

The Decision Below, If Allowed To Stand,

Will Have The Counterproduc. ve Effect Of

Rewarding Peer-To-Peer Services That

Refuse To Take Reasonable Steps To Prevent

Or To Reduce Massive Amounts Of

Litigation Against Multiple Individual

ED vcd bn dikes dadbuadikducwieees

As The Seventh Circuit Has Concluded, Peer-

To-Peer Services Should Be Secondarily

Liable For The Massive Copyright

Infringement They Facilitate, Absent A

Showing That It Would Be Disproportionately

Costly For Them To Eliminate Or To Reduce

Substantially That Infringement ..........

CRNEEAINIED Nec ceevecdavescnsiveeseencnne

Page

TABLE OF CITED AUTHORITIES

Page

CASES

A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004

fe | eererrerrrrrerr ry rr 12, 13

A&M Records, Inc. v. Napster, Inc., 284 F.3d 1091

Cs COR, BONED veto ctevcvecesesesvassees 12, 13, 14

Aro Mfg. Co. v. Convertible Top Replacement Co.,

S77 UD. STOCIGO cccccccsececseviuszedds ll

BMG Music v. Does 1-203, No. 04-650, 2004

WL 442626 (E.D. Pa. Mar. 5, 2004) ...... cee 9

Dawson Chem. Co. v. Rohm & Haas Co., 448 U.S.

TR GRGOED cv cccecacesevécesnesssnsscvevaut 11, 22

Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., 499 U.S.

DEDGEOOED 5 00bccveceestecéesonceetaevernse 10

Fromberg, Inc. v. Thornhill, 315 F.2d 407 (Sth Cir.

TWD nvcvccectsseeceeenceessbdnepeneaue 26

Gershwin Publ’g Corp. v. Columbia Artists Mgmt.,

Inc., 443 F.2d 1159 (2d Cir. 1971) ............ 17

Imagexpo, LLC v.-Microsoft Corp., 284 F. Supp. 2d

3GS GED. VO. FRB) nc cccccccccccvescesvaes 27

In re Aimster Copyright Litig., 334 F.3d 643

(7th Cir. 2003), cert. denied, 540 U.S. 1107

CPD cccdccnernevaddnadadcensepecetivans passim

iii

Cited Authorities

Page

In re Cases Filed by Recording Companies, Case

Nos. A-04-CA-550 LY, A-04-CA-636 SS, A-04-

CA-703 LY, A-04-CA-704 LY (W.D. Tex. Nov. 17,

BOON) ...cccnceenesesedenenenennniaeee 9

In re Charter Comms. Inc., Subpoena Enforcement

Matter, _ F.3d __, 2005 WL 15416 (8th Cir.

BOOS) ncccoccesccustensenanaennae 9

Interscope Records v. Does 1-25, No. 6:04-CV-197-

ORL-22-DAB (M.D. Fla. Apr. 27, 2004) ...... 9

Mercoid Corp. v. Mid-Continent Investment Co.,

320 U.S. 668 (IGS) oo ccccesvnaudenanenen 6

Metro-Goldwyn Mayer Studios, Inc. v. Grokster, Lid.,

380 F.3d 1154 (9th Cir. 2004) .............. passim

Metro-Goldwyn Mayer Studios, Inc. v. Grokster, Ltd.,

259 F. Supp. 2d 1029 (C.D. Cal. 2003) ...4, 12, 13, 14

Oak Industries, Inc. v. Zenith Electronics Corp.,

697 F. Supp. 988 (N.D. Ill. 1988) ............ 27, 28

Philips Elecs. N. Am. Corp. v. Contec Corp., No. Civ.

A. 02-123-KAJ, 2004 WL 1622442 (D. Del. July

12, SEBS)... cseccesacthéce ceununeanenene 27

Cited Authorities

Page

Recording Indus. Ass'n of Am., Inc. v. Verizon

Internet Servs., Inc., 351 F.3d 1229 (D.C. Cir.

2003), cert. denied, 125 S. Ct. 309 (2004); 125

Gk er ED wacbdocdeuncscoccttsds gene 9

Rupp & Wittgenfeld Co. v. Elliott, 131 F. 730 (6th

Sk C4 saat dus uchodéeeanvaseeseunaseces 26

Shapiro, Bernstein & Co. v. H.L. Green Co., 316 F.2d

DP , De oc ckuvhetdeuedvstessedwe 17

Sony Corp. of America v. Universal City Studios, Inc.,

Pe Ee GE CUUEPED b 6 ccescecectecdsoncece< passim

Thomson-Houston Elec. Co. v. Ohio Brass Co.,

Dt, SE OEOE cvuscdsedtnesduenes 27

Twentieth Century Fox Film Corp. v. Does 1-/ 2,

No. C 04-04862 (N.D. Cal. Nov. 16, 2004) .... 9

Universal City Studios, Inc. v. Sony Corp. of America,

480 F. Supp. 429 (C.D. Cal. 1979) ............ 22-23

STATUTES

SP en UE oo cbaveccadadéed sceeeceesess 27

Cited Authorities

Page

OTHER AUTHORITIES

William J. Adkinson, Liability of P2P File-Sharing

Systems for Copyright Infringements by their Users,

Prooress ON Point (The Progress & Freedom

Foundation Mar. 2004) @vailable at http://

www.pff.org/publications/ip/pop! 1.7p2psystems.

GE bvccdeadsnecdnetnnnd bees tareianueeas 19

Administrative Office of the U.S. Courts, Table C3

- U.S. District Courts-Civil Cases Commenced,

by Nature of Suit and District, During 12-Month

Period Ending September 30, 2003, 2003 Judicial

Business (available at http://www.uscourts.gov/

judbus2003/appendices/c3.pdf) .............. 8

Stacey L. Dogan, /s Napster a VCR? The Implications

of Sony for Napster and Other Internet Technologies,

$2 Hastincs L.J. 939 (2001) ..................20, 21

Jane Ginsburg, Copyright Use and Excuse on

the Internet, 24 Corum. V.L.A. J.L. & Arts 1

GREE si CobcccubendedvesiatedaSessaenbabe 23

The Intentional Inducement of Copyright Infringements

Act of 2004: Hearing on S. 2560 Before the Senate

Comm. on the Judiciary, 108th Cong. (2004)

(statement of the Hon. Marybeth Peters,

(available at http://www.copyright.gov/docs/

PEED nea csencdévedscectiuct 6, 11, 25

Cited Authorities

Tony Smith, RJAA Sues 754 More P2Pers, Tut REGISTER

(Dec. 17, 2004) (available at http://www .theregister.

co.uk/2004/12/17/riaa_sues 754/) .............

Alex Veiga, Moviemakers to Sue Internet Pirates;

Studios Follow Path of Music Industry, Cut.

Tris., Nov. 5, 2004 (available at 2004 WL

PPASST ISD cc ccccscccccccscccsecseosecteses

Fred Von Lohmann, JAAL (] Am A Lawyer): Peer-to-

Peer File Sharing and Copyright Law After Napster

(2001) at “Lessons and Guidelines for P2P

Developers” (available at http://www.gtamarketing.

com/P2Panalyst/VonLohmann-article.html) .... ..

Fred Von Lohmann, JAAL (1 Am A Lawyer): What Peer-

to-Peer Developers Need to Know about Copyright

Law (Sept. 2004) (available at http//www.efforg/

Page

IP/P2P/2f=p2p copyright wp _v4.html) ...... 15, 16, 17

Brief of Appellee Grokster, Ltd., Metro-Goldwyn

Mayer Studios, Inc. v. Grokster, Ltd., No. 03-

55894, 2003 WL 22762385 (9th Cir. filed Sept.

YR Pe

Reply Brief of Petitioners, Sony Corp. of Am. v.

Universal City Studios, Inc., No. 81-1687, LEXsee

1981 U.S. BRIEFS 1687 (filed Dec. 3, 1982) ...

INTERESTS OF AMICI CURIAE'

Amici are twelve separate organizations that represent

thousands of members whose 'ivelihoods or businesses depend

upon effective copyright protection. Those members include

individuals and corporate entities involved in creating and

making available to the American public a wide variety of

copyrighted works — motion pictures, television programming,

sports programming, literary works, interactive video games

and photographic art. Amici's members are subject to the same

Internet piracy that plagues the motion picture and music

industry Petitioners and that the Ninth Circuit, in its decision

below, effectively permits to continue. Amici's primary purpose

in submitting this brief is to draw the Court’s attention to the

practical implications of the decision below and to suggest an

alternative approach for resolving the issues raised by

Respondents’ facilitation of that piracy.

Amici Office of the Commissioner of Baseball, National

Basketball Association, and National Football League represent

clubs engaged in professional sports. The professional sports

clubs and leagues are responsible for the production of, and

own the copyrights in, various audio and video products that

they seek to market to the public, over the Internet and otherwise.

Increasingly, however, these products are distributed illegally,

and free of charge, over Internet file-sharing services, thereby

1. Letters from all parties consenting to the filing of this brief are

on file with the Clerk of the Court. No person or entity, other than Amici,

their members and their counsel, made a monetary contribution to the

preparation or submission of this brief. No counsel for a party in this

matter authored this brief in whole or in part. Counsel for Amici represent

certain of the Petitioners and the Recording Industry Association of

America in matters other than this case, and they represent certain of

the Amici in matters in addition to this case.

impairing Amici's ability to engage in an important segment of

their business.

Amicus the Producers Guild of America, Inc. represents

motion picture, television and new media producers.

The members of Amicus the Independent Film & Television

Alliance distribute internationally (and often produce and

finance) the motion pictures and television programming that

are created outside of the seven major United States studios,

including such recent films as the Lord of the Rings trilogy,

Chicago, Cold Mountain, Lost in Translation, Monster, The

Passion of the Christ, Shakespeare in Love, Whale Rider and

Traffic. The income that the members of these Amici receive is

tied directly to sales of DVDs and other video products — the

very sales that are displaced by illegal file-sharing.

Amici the Association of American Publishers, Inc., the

Association of American University Presses, and The Authors

Guild, Inc. represent the creators and distributors of various

types of literary works. Amicus the Graphic Artists Guild

represents, among others, illustrators and cartoonists whose

creative efforts appear in such works and other media. Illegal

file-sharing has adversely impacted the efforts of these Amici

to create a legitimate and robust electronic book market.

Amicus Entertainment Software Association represents

companies that, among other things, publish and sell mteractive

entertainment software (including video and computer games).

Infringing distribution of entertainment software, through peer-

to-peer networks and otherwise, costs legitimate software

vendors billions of dollars in lost sales, robbing game developers

and the game industry of revenue that could be used to

underwrite the creation and marketing of an even wider array

of game titles.

Amici the Professional Photographers of America, Inc. and

the American Society of Media Photographers, Inc. represent

the copyright interests of photographers working in a wide range

of media and industries. Illegal file-sharing poses particularly

significant risks for publication photographers and other small

degree upon commercial exploitation of their creative works.

SUMMARY OF ARGUMENT

The fundamental issue raised by this case is whether

copynght protection will have any practical meaning in a digital

environment — where Internet “file-sharing” services (without

compensating or obtaining the consent of copyright owners)

permit the virtually effortless and anonymous worldwide

distribution of perfect copies of copyrighted works.

1. There is no dispute that such unauthorized file-sharing

constitutes copyright infringement, which is committed on a

daily basis by millions of people “who are ignorant or more

disdainful of copyright and in any event discount

the likelihood of being sued or prosecuted for copyright

infringement.” Jn re Aimster Copyright Litig., 334 F.3d 643,

645 (7th Cir. 2003) (Posner, J.), cert. denied, 504 U.S. 1107

(2004) (“Aimster’’). Nor is there any dispute that “peer-to-peer”

file-sharing services, such as those offered by Respondents, are

used overwhelmingly for purposes of copyright infringement.

These services profit handsomely from, and would have no

commercial business but for, that infringement. And they take

affirmative steps to ensure that such infringement continues.

Nevertheless, in the decision below, the Ninth Circuit Court of

Appeals held that peer-to-peer services, by simply switching

from a centralized index of files to a decentralized index of

files (a process invisible and meaningless to an Internet user),

can avoid secondary liability for facilitating hundreds of millions

of acts of online copyright infringement. See Metro-Goldwyn

Mayer Studios, Inc. v. Grokster, Ltd., 380 F.3d 1154 (9th Cir.

2004), aff’g Metro-Goldwyn Mayer Studios, Inc. v. Grokster,

Lid., 259 F. Supp. 2d 1029 (C.D. Cal. 2003) (“Grokster”).

2. Over twenty years ago, in a very different factual context,

the Court formulated principles to determine whether a

manufacturer of a product that facilitates copynght infringement

is secondarily liable for that infringement. See Sony Corp. of

Am. v. Universal City Studios, Inc., 464 U.S. 417 (1984) (“Sony-

Betamax”). The Court did so by striking a careful “balance

between a copyright holder’s legitimate demand for effective —

not merely symbolic — protection of the statutory monopoly,

and the rights of others freely to engage in substantially unrelated

areas of commerce.” /d. at 442. The Ninth Circuit decision below

upsets that balance and seriously erodes the value of copyright

protection in a digital world.

That decision leaves the copyright community with an

untenable Hobson’s choice for responding to the literally

millions of daily acts of infringement that the peer-to-peer

services make possible — either flood the federal courts with

numerous “John Doe” lawsuits against individual infringers

(as some copyright owners have already been forced to do) or

permit that infringement to go unchallenged and allow the value

of their works to bleed away. But the very reason that the courts

developed the secondary copyright liability doctrine was to avoid

imposing such a burden on copyright owners and the federal

judicial system and to ensure protection of rights guaranteed by

the Constitution and the Copyright Act. Engaging in costly and

burdensome litigation against a multitude of individual

infringers is simply not a viable option for Amici. Consequently,

the decision below, if allowed to stand, will deprive numerous

countless acts of copyright infringement.

The decision below also has the perverse effect of

discouraging peer-to-peer services from acting responsibly by

taking steps that could reduce or even eliminate online

copynght immunity when they refuse or fail to take such actions.

The decision provides peer-to-peer services with a detailed blueprint

for devising a system that evades all liability and equitable relief

for facilitating copyright infringement on an unprecedented scale.

There are several steps peer-to-peer services can reasonably take

(and should take) that would significantly minimize the scope of

online copyright infringement and that would not interfere with

the comparatively de minimis amount of lawful file-sharing

they may make possible. They can take these steps because

(unlike the Betamax manufacturer) they maintain an ongoing

ability to separate infringing and noninfringing uses. The Ninth

Circuit, however, improperly deemed such steps to be “irrelevant.”

3. The Seventh Circuit Court of Appeals has taken a

different, and mure responsible, approach than the Ninth Circuit to

In Aimster, the Seventh Circuit affirmed the district court’s

determination that the peer-to-peer services in that case are

secondarily liable for the infringement they facilitate. In doing so,

the Seventh Circuit concluded:

Even when there are noninffinging uses of an Internet

file-sharing service, moreover, if the infringing uses

are substantial then to avoid liability as a contributory

infringer the provider of the service must show that it

would have been disproportionately costly for him to

eliminate or at least reduce substantially the infringing

uses.

334 F.2d at 653; see also id. at 648 (requiring a showing that

the “detection and prevention of the infringing uses would be

highly burdensome”’).

The above approach is consistent with the Court’s decision

in Sony-Betamax and the patent law “staple article of commerce”

doctrine that the Court adapted to copyright law in

Sony-Betamax. Most importantly, the Seventh Circuit approach

is faithful to the balance that the Court struck in Sony-Betamax,

and it addresses the matter that Amici believe should be of

principal concern here. It provides peer-to-peer services with

an incentive (rather than a disincentive) to take reasonable steps

that eliminate or at least minimize the amount of online copyright

infringement — and thereby reduces the need for copyright

owners to initiate (and for the courts to deal with) burdensome

litigation against numerous individual infringers.

4. As the Court noted in Sony-Betamax, “the concept of

contributory infringement is merely a species of the broader

problem of identifying the circumstances in which it is just to

hold one individual accountable for the actions of another.”

464 U.S. at 435. See also Mercoid Corp. v. Mid-Continent Inv.

Co., 320 U.S. 661, 667 (1944) (Frankfurter, J., dissenting)

(noting that “the doctrine of contributory infringement is an

expression both of law and morals”). In its decision below, the

Ninth Circuit has adopted an approach that, as the Register of

and thus loses sight of the principles of justice and moral

responsibility underlying Sony-Betamax and the doctrine of

secondary copyright liability. On the other hand, the Seventh

Circuit in Aimster has adopted a sound and balanced approach

that both makes sense and effectuates these underlying policies.

Amici strongly urge the Court to reverse the decision below and

2. The Intentional Inducement of Copyright Infringements Act of

2004: Hearing on S. 2560 Before the Senate Comm. on the Judiciary,

108th Cong. 13 (2004) (statement of the Hon. Marybeth Peters, Register

of Copyrights, U.S. Copyright Office) (hereinafter “Register’s

Statement”) (available at http://www.copyright.gov/docs/

regstat072204.html) (referring to the district court decision in this case).

to adopt the Seventh Circuit approach in dealing with the

secondary copyright liability of peer-to-peer file-sharing

services.

Amici do not believe the courts should discourage

including innovations that facilitate the lawful sharing of

information over the Internet. Nothing in the Seventh Circuit

approach would have such a discouraging effect. In contrast, by

immunizing enterprises like those of Respondents from

secondary copyright liability — enterprises that the record amply

demonstrates were designed and operated with the knowledge

that they would be employed overwhelmingly to facilitate

promote technology. Indeed, as discussed below, one of the

unfortunate aspects of the Ninth Circuit’s decision would be its

elimination of incentives for genuine technological creativity.

ARGUMENT

I. THE DECISION BELOW, IF ALLOWED TO STAND,

WILL BURDEN THE JUDICIAL SYSTEM WITH

MULTIPLE INDIVIDUAL INFRINGEMENT

ACTIONS AND WILL DEPRIVE COPYRIGHT

OWNERS OF A MEANINGFUL REMEDY

FOR MILLIONS OF ACTS OF COPYRIGHT

INFRINGEMENT

1. The Ninth Circuit’s decision below provides copyright

owners with only one, highly unsatisfactory option for seeking

redress for the hundreds of millions of acts of copyright

infringement that are facilitated by Respondents’ services —

lawsuits against a multitude of individual infringers. That is the

course of action that the recording and motion picture industries

have pursued since the district court in this case first absolved

Respondents from secondary liability. During the past year,

record companies have filed copyright infringement actions

against more than 7,700 individual infringers.’ Had each

individual been sued separately, as some courts have required

(see infra page 9), the number of cases generated by that

litigation alone would equal the total number of all other

system for the year ending September 30, 2003.‘ The motion

picture industry also has sued hundreds of individual infringers.°

The experience derived from such litigation highlights the

serious problems with the decision below — both from the

judicial administration.

obstacles in pursuing individual infringers. It is, of course,

difficult to identify those infringers because file-sharing services,

such as those operated by Respondents, are designed to enable

their users to act anonymously or pseudonymously. The

difficulties have been exacerbated by judicial decisions that

preclude copyright owners from taking advantage of provisions

in the Digital Millennium Copyright Act that require Internet

service providers to identify specific infringers in response to

3. See Tony Smith, RIAA Sues 754 More P2Pers, Tt REGISTER

(Dec. 17, 2004) ( available at http://www .theregister.co.uk/2004/12/17/

riaa_sues_754/).

4. See Administrative Office of the U.S. Courts, Table C3 - U.S.

District Courts-Civil Cases Commenced, by Nature of Suit and District,

During 12-Month Period Ending September 30, 2003, 2003 Judicial

Business (available at http://www.uscourts.gov/judbus2003/appendices/

c3.pdf).

5. See Alex Veiga, Moviemakers to Sue Internet Pirates; Studios

Follow Path of Music Industry, Cui. Tris., Nov. 5, 2004, at 5 (available

at 2004 WL 97456770).

requests from copyright owners.’ Copyright owners have thus

been forced to file cumbersome “John Doe” suits and then serve

subpoenas (often contested) to obtain the infringers’ identities.

The Electronic Frontier Foundation, which represents one

of the Respondents in this appeal, has conjured a plethora of

arguments designed to make the prosecution of these actions

even more problematic for copyright owners. See, e.g., http://

www.eff.org/IP/P2P/Fonovisa_v_Plank/plank_answer.pdf

(raising twenty-two separate defenses to a John Doe copyright

infringement action). For example, these arguments have

convinced some courts to rule that copyright owners may not

bring one action seeking the identities of multiple “John Doe”

customers of a single internet service provider, but rather

must initiate a separate action against each individual infringer.’

Decisions such as these have imposed considerable and

unnecessary costs on both copyright owners and the judicial

system — all as a result of the decisions below.

6. See In re Charter Comms. Inc., Subpoena Enforcement Matter,

__ F.3d __, 2005 WL 15416 (8th Cir. 2005); Recording Indus. Ass'n of

Am., Inc. v. Verizon Internet Servs., Inc. , 351 F.3d 1229 (D.C. Cir. 2003),

cert. denied, 125 §. Ct. 309 (2004); 125 S. Ct. 347 (2004).

7. See In e Cases Filed by Recording Companies, Case Nos.

A-04-CA-550 LY, A-04-CA-636 SS, A-04-CA-703 LY, A-04-CA-704

LY (W.D. Tex. Nov. 17, 2004) (prohibiting joinder and requiring that

four actions be refiled as 254 separate John Doe actions); BMG Music v.

Does 1-203, Civil Action No. 04-650, 2004 WL 442626 (E.D. Pa. Mar.

5, 2004) (prohibiting joinder and requiring 203 separate John Doe

actions); /nterscope Records v. Does 1-25, No. 6:04-CV-197-ORL-22-

DAB (M.D. Fla. Apr. 27, 2004) (prohibiting joinder and requiring

separate John Doe actions); Twentieth Century Fox Film Corp. v. Does

1-12, No. C 04-04862 (N.D. Cal. Nov. 16, 2004) (permitting discovery

against Doe | and staying action against Does 2-12 because joinder

improper), aff'd on recon., (Dec. 1, 2004). Copies of these orders may

be found at http://www.eff.org/IP/P2P/?f=riaa-v-thepeople.html and

http://www.eff.org/IP/P2P/ MPAA_v_ThePeople/.

2. The possibility of instituting individual copyright

infringement actions against a multitude of individuals engaged

in unlawful file-sharing is not a practicable option for Amici

and their members. And, while major motion picture and record

companies have filed lawsuits against thousands of individuals,

they are certainly not able to litigate against all of the millions

of individuals engaged in online copyright infringement.

The costs and burdens of litigation against multiple John Doe

infringers — as reflected in the recording and motion picture

industries’ experience — are overwhelming. Particularly for many

small and individual copyright owners, it is not practicable,

financially or otherwise, to bring enforcement actions against

users of file-sharing technology. Deprived of any practical

remedy to protect their copyright interests against the onslaught

of file-sharing technology, many copyright owners find their

copyrights virtually useless in a digital environment and their

ability to exploit and protect their work seriously endangered.

As the Court has recognized, the endangerment of the protection

of copyrighted works is tantamount to the endangerment of the

creation of those works. See Feist Publ’ns, Inc. v. Rural Tel.

Serv. Co., 499 U.S. 340, 349 (1991).

The very purpose of the copyright secondary liability

doctrine is to avoid precisely such burdensome litigation that

renders impracticable the enforcement of copyright rights.

As the Seventh Circuit in Aimster observed:

Recognizing the impracticability or futility of a

infringers (“chasing individual consumers is time

consuming and is a teaspoon solution to an ocean

problem”), ... the law allows a copyright holder to

sue a contributor to the infringement instead, in effect

as an aider and abettor.

334 F.3d at 645-46 (citation omitted). Cf Dawson Chem. Co. v.

Rohm & Haas Co., 448 U.S. 176, 188-89 (1980) (explaining

that the protection afforded by the contributory infringement

doctrine in patent law “is of particular importance in situations

. . . Where enforcement against direct infringers would be

difficult’); Aro Mfg. Co. v. Convertible Top Replacement Co.,

377 U.S. 476, 511 (1964) (purpose of patent contributory

infringement doctrine is “to provide for the protection of patent

rights where enforcement against direct infringers is

impracticable . . .””) (citation omitted).

The ability to make use of the secondary copyright liability

doctrine is particularly significant in the digital context where

millions of individuals routinely engage in copyright

infringement on an anonymous or pseudonymous basis. As the

liability doctrine is

critical to the effective functioning of our copyright

system, and even more so in the new digital

environment. [That doctrine] allow[s] copyright

owners to focus their enforcement (and licensing)

efforts on those entities that foster infringing activity

and have the resources and wherewithal to either

pay licensing fees or satisfy an infringement

judgment, without bringing costly, time-consuming

and usually futile actions against multiple, mostly

judgment-proof individual defendants.

The decision of the Ninth Circuit below improperly deprives

liability docirine. In doing so, it effectively deprives copyright

owners of any viable means to redress numerous acts of online

infringement.

ll. THE DECISION BELOW, IF ALLOWED TO STAND,

WILL HAVE THE COUNTERPRODUCTIVE

EFFECT OF REWARDING PEER-TO-PEER

SERVICES THAT REFUSE TO TAKE

REASONABLE STEPS TO PREVENT OR TO

REDUCE MASSIVE AMOUNTS OF COP %.GHT

INFRINGEMENT AND RESULTING LITIc * clON

AGAINST MULTIPLE INDIVIDUAL INFRINGERS

The economic model of Respondents’ business is simple —

Respondents’ services, the more money Respondents make.

Respondents profit by selling advertising that reaches computer

users while they are committing infringement with the aid of

the file-sharing software Respondents provide free of charge.

Grokster, 259 F. Supp. 2d at 1044; Pet. at 4. That model has

been quite successful. Hundreds of millions of files have been,

and continue to be, traded using peer-to-peer software. While

some individuals may use that software for lawful file-sharing

of public domain or authorized works, the vast majority (over

90%) of peer-to-peer file-sharing is indisputably illegal.

Grokster, 380 F.3d at 1158; Pet. at 9. Under these circumstances,

there is certainly no economic incentive for Respondents or other

peer-to-peer services to take reasonable actions that minimize

the level of copyright infringement. Nor is there any legal

incentive to do so under the decision below.

1. A separate Ninth Circuit panel required a peer-to-peer

service to take such action in A&M Records, Inc. v. Napster,

Inc., 239 F.3d 1004 (9th Cir. 2001) (“Napster I), and A&M

Records, Inc. v. Napster, Inc., 284 F.3d 1091, 1098 (9th Cir.

2002) (“Napster I”) (“Napster must do everything feasible to

block files from its system which contain noticed copyrighted

works.”). The Seventh Circuit did likewise in Aimster. See infra

pp. 18-19. But the panel below chose a different path.

Following the Ninth Circuit’s decisions in Napster,

mandated in those decisions to control infringement. Instead,

Respondents chose to structure their system so that (as one of

the Respondents’ counsel had suggested in his widely-circulated

“legal primer”) they could demonstrate “plausible deniability”

of knowledge, and control, of the infringement they facilitate —

sufficient to “convince a judge” that monitoring and blocking

are not possible.* Respondents thereby sought to capitalize on

without incurring liability for that infringement. See Grokster,

259 F. Supp. 2d at 1046 (acknowledging that Respondents “may

have intentionally structured their businesses to avoid secondary

from the illicit draw of their wares”); Register’s Statement, supra

note 2, at 17-18 (explaining how Respondents’ software is

programmed to ensure that users “share” as many files as

possible without regard to their copyright status).

According to the Ninth Circuit, Respondents found the key

to circumventing the Napster decisions — avoid the use of central

servers with indices of the files residing on their users’

computers. Such decentralization does not result in any reduction

in the amount of infringement that Respondents induce; nor

does it sever the connection between Respondents and users.

After all, Respondents need to keep serving advertisements to

the users to keep their lucrative income stream flowing.

However, in mcving to a decentralized system, Respondents

sought to diminish their ability to stop the infringement they

& See Fred Von Lohmann, JAAL (I Am A Lawyer): Peer-to-Peer

File Sharing and Copyright Law After Napster (2001) at “Lessons and

Guidelines for P2P Developers,” paras. | & 3 (@vailable at http://

www.gtamarketing.com/P2Panalyst/V onLohmann-article.html).

knew was occurring. Thus, decentralization provided

Respondents with the level of “plausible deniability” that was

necessary to “convince” at least the Ninth Circuit not to impose

secondary liability.

2. Even under Respondents’ decentralized architecture,

Respondents know very well how to prevent content from

reaching their users when they want to block that content. For

example, Respondents routinely filter out files containing

pornographic material or viruses. They also have blocked or

hindered the distribution of “bogus” (incomplete) files that some

infringement. See Pet. at 7-8 & n.4, 11-14.

Petitioners introduced considerable evidence below that

Respondents likewise could have blocked files containing

copynghted works that were not authorized for distribution over

Respondents’ network, e.g., by employing filtering,

“digital fingerprinting” or “meta data” screening technology.

Compare Napster II, 284 F.3d at 1098-99 (affirming order that

Napster not operate without an appropriate filtermg mechanism).

The district court, however, ruled that evidence “immaterial”

to its analysis, without even considering the feasibility and

efficacy of any of the blocking methods. See Grokster,

259 F. Supp. 2d at 1045; see also id. at 1046 (court “need not

decide whether steps could be taken to reduce the susceptibility

of [Respondents’] software to unlawful use ...”). The court of

appeals agreed, deeming “irrelevant” the measures that

Respondents could have taken to minimize copyright

infringement. Grokster, 380 F.3d at 1166.

The Ninth Circuit below attached significance to the fact.

Respondent Grokster lacked a “registration and log-in process”

which could have been used to block known infringers’ access

to the network. /d. at 1165. Grokster, however, originally

employed such a process and disabled it only after the litigation

below was commenced. Pet. at 7. The Ninth Circuit also attached

significance to the fact that Respondent Streamcast chose not

to have a licensing agreement with any of its users (id.), thus

encouraging all peer-to-peer services to put themselves in a

position where they supposedly have no legal right to terminate

infringing users.

3. The decision below sends a clear message to peer-to-

peer services that wish to build their businesses on copyright

infringement. Under the Ninth Circuit approach, peer-to-peer

services need not be concerned about taking any actions that

would minimize the scope of the copyright infringement they

make possible. Under that approach, they can escape liability

for facilitating hundreds of millions of acts of copyright

infringement as long as they take steps designed to distance

themselves from the nght and ability to control that infringement

— notwithstanding that they retain the nght and ability to deliver

advertisements, to block pornographic content and to filter out

anti-infringement methods employed by copyright owners.

The most recent version of the “legal primer” for peer-to-

peer services authored by one of Respondents’ counsel elaborates

on this message, providing the following “advice” on how to

* “fYjou can either include mechanisms that

enable monitoring and control of user activities

(and use them to stop allegedly infringing

activity when you receive complaints), or choose

a truly decentralized architecture that will

convince a judge that such monitoring and

9. Fred Von Lohmann, /AAL (1 Am A Lawyer): What Peer-to-Peer

Developers Need to Know about Copyright Law (Sept. 2004) ( available

at http://www.eff.org /IP/P2P/?f=p2p_copyright_wp_v4.html) (“2004

P2P Primer”).

control is impossible without extensive

redesign.” 2004 P2P Primer at V.2 (emphasis

added).

“[A] P2P developer would be wise to choose

an architecture that will convince a judge that

control over end-user activities is impossible.”

Id.

“If you want to avoid monitoring obligations,

you'll have to give up on anything that smacks

of ‘control.”” Jd. at V.3.

“The key here is to let go of any control you

may have over your users — no remote kill

switch, automatic update feature, contractual

termination rights, or other similar

mechanisms.” /d.

“{P}rudence suggests that vendors give anything

that smacks of ‘control’ a wide berth.” /d.

“Separate different functions and concentrate

your efforts on a discrete area. A

disaggregated model .. . may limit what a cout

can order you to do to stop infringing activity

by your users. As the Napster court recognized,

you can only be ordered to police your own

‘premises’ — the smaller it is, the less you can

be required to do.” /d at V.6.

“Although end-user agreements (‘EULA’) are

ubiquitous in the software world .. . they may

leave the impression that a vendor has the legal

right to stop users from using the software [for

infringement]. P2P software vendors should

consider distributing their code without a

EULA. Even without a EULA, a software

developer retains all of the protections of

duplication and modifications.” Id. at V.8

(emphasis added).

As the above suggests, peer-to-peer services inherently have

the “power to police carefully the conduct” of their users. Sony-

Betamax, 464 U.S. at 438 n.18, quoting Shapiro, Bernstein &

Co. v. H.L. Green Co., 316 F.2d 304, 308 (2d Cir. 1963);

see also Sony-Betamax, 464 U.S. at 438 n.18, citing Gershwin

Publ'g Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159,

1163 (2d Cir. 1971) (attaching significance to the fact that the

defendant was ‘in a position to police the infringing conduct’)

(emphasis added). However, the decision below encourages

peer-to-peer services to do what they can to distance themselves

from that power — or at least create “plausible deniability” — in

order to absolve the services of responsibility for the

which they profit.

Amici submit that the Ninth Circuit approach is unwise and

inconsistent with the policies underlying the Court’s decision

in Sony-Betamax. See infra pp. 19-20. The proper balance is

one that encourages (rather than discourages) peer-to-peer

services to minimize copyright infringement while still

preserving their right to facilitate whatever lawful file-sharing

may exist over their networks. Imposing secondary liability on

“simply encourage” them to exercise their inherent “power to

police,” “thus placing responsibility where it can and should be

effectively exercised.” Sony-Betamax, 464 U.S. at 438 n.18,

quoting Shapiro, Bernstein & Co. v. H.L. Green Co., 316 F.2d

304, 308 (2d Cir. 1963).

iil. AS THE SEVENTH CIRCUIT HAS CONCLUDED,

PEER-TO-PEER SERVICES SHOULD BE

SECONDARILY LIABLE FOR THE MASSIVE

ITATE, ABSENT A SHOWING THAT IT WOULD

BE DISPROPORTIONATELY COSTLY FOR THEM

TO ELIMINATE OR TO REDUCE SUBSTAN-

TIALLY THAT INFRINGEMENT

Amici believe that the decision of the Seventh Circuit Court

of Appeals in Aimster provides an appropriate approach for

dealing with the secondary liability of peer-to-peer services.

In Aimster, the Seventh Circuit affirmed a district court’s ruling

that certain peer-to-peer services are secondarily liable for the

infringements they facilitate, concluding:

Even when there are noninfringing uses of an Internet

file-sharing service, moreover, if the infringing uses

are substantial then to avoid liability as a contributory

infringer the provider of the service must show that

it would have been disproportionately costly for him

to eliminate or at least reduce substantially the

infringing uses.

334 F.3d at 653; see also id. at 648 (requiring a showing that

the “detection and prevention of the infringing uses would be

highly burdensome”).

The Seventh Circuit approach focuses on the feasibility of

actions that peer-to-peer services can take to reduce, if not

eliminate, the amount of infringing activity that occurs with the

software they provide. And, unlike the approach of the Ninth

Circuit below, it provides an incentive for peer-to-peer services

to take that action. If these services fail to take the infringement-

minimizing actions that they are reasonably capable of taking

(if they instead attempt merely to create “plausible deniability”),

they will be held secondarily liable for the infringements they

cause. The Seventh Circuit approach would thus help achieve

the goal of reducing the massive amount of online infringement

caused by Respondents and other peer-to-peer services without

the need for costly and burdensome litigation against multiple

individual infringers. See generally William J. Adkinson,

Liability of P2P File-Sharing Systems for Copyright

Infringements by their Users, ProGress ON Pont (The Progress

& Freedom Foundation Mar. 2004) (discussing advantages of

Seventh Circuit approach) @vailable at http://www.pff.org/

publications/ip/pop | 1.7p2psystems.pdf).

1. Amici believe that the Seventh Circuit approach should

be adopted by the Court because it effectuates the policies

underlying the balance that the Court struck in Sony-Betamax.

The Court in Sony-Betamax was confronted with competing

policy considerations. The Court recognized that when a charge

of contributory infringement is based on the sale of an article of

commerce used to infringe, “the public interest in access to that

article of commerce is necessarily implicated.” 464 U.S. at 440.

The Court also noted a concern about “enlarging the scope” of

commerce that is not the subject of copyright protection.”

Id. at 421. Nevertheless, the Court made clear that “adequate

protection of 2 monopoly may require the courts to look beyond

actual duplication of a device or publication to the products or

activities that make such duplication possible.” Jd. at 442.

The Court in Sony-Betamax thus sought to

strike a balance between a copyright holder’s

legitimate demand for effective — not merely

symbolic — protection of the statutory monopoly, and

the nghts of others freely to engage in substantially

unrelated areas of commerce.

Id. at 442. See Stacey L. Dogan, /s Napster a VCR? The

Implications of Sony for Napster and Other Internet

Technologies, 52 Hastincs L.J. 939, 942, 959 (2001)

(The Court’s objective in Sony-Betamax was not “merely to

insulate new technologies. Its objective was to strike a balance

between the incentive structure of copyright, on the one hand,

and the integrity of ‘substantially unrelated areas of commerce,’

on the other. ... As the Supreme Court recognized, the public

does not always benefit when technology prevails over

Likewise, the Seventh Circuit in Aimster recognizes that,

absent imposition of secondary liability on peer-to-peer operators

that facilitate massive amounts of infringement, copyright

owners would have no practicable means of protecting their

copyrights in a digital environment; they would be left with

merely “symbolic protection,” 464 U.S. at 442, and their

incentive to create new works would be impaired. At the same

time, the Seventh Circuit simply requires that the peer-to-peer

operator take reasonable action to eliminate or to reduce

infringement; it does not preclude the operator from offering

its service to the public for lawful file-sharing. Where the relief

sought by copyright owners does not, as under the Seventh

Circuit approach, seek to preclude the use of a product for lawful

purposes, the Court’s concerns with protecting access to that

product are not implicated. See S. Dogan, supra, 52 Hastincs

LJ. at 956.

Respondents, of course, may be concerned about the

commercial viability of their services if they offer file-sharing

for only lawful purposes. But if Respondents’ services must

rely upon massive infringement as their primary use, then

Respondents are not “engage[{d] in a substantially unrelated area

of commerce.” 464 U.S. at 442. And the Court’s concern in

Sony-Betamax offers them no sanctuary. As one commentator

has noted, “if a product is so integrally related to infringement

that a market for it would never have developed absent

infringement, there is no ‘substantially unrelated’ market with

which courts must not interfere.” S. Dogan, 52 Hastincs L.J. at

943; see also id. at 958 (“A business enterprise whose raison

d'etre is infringement owes it to those who effectively fund its

operation to share in [its] proceeds.”).

2. Amici believe that the Seventh Circuit approach also

should be adopted by the Court because it would create the

appropriate economic incentives for finding a technological

solution to the vexing problem of Internet piracy.

As new generations of digital media are developed — Blu-

Ray discs, HD-DVDs, Dual Discs and their eventual successors

— content owners and providers such as Amici will be able to

employ new encryption and digital rights techniques to protect

their content from unauthorized distribution. Under the Seventh

Circuit approach, peer-to-peer services would be required to

respect these new techniques only if it was reasonable for them

to do so, thereby creating an incentive for technology developers

to make these techniques easier and cheaper to employ. This

should lead in time to a substantial decline in piracy, with little

cost or burden on peer-to-peer services, funded primarily by

the copyright owners who would benefit.

The Ninth Circuit approach, however, by effectively making

willful blindness and evasion a legal defense to contributory

infringement, would eliminate the need for peer-to-peer services

to make any effort to adopt new technology, and would thereby

discourage content owners from making the investment

necessary to find better solutions for protecting content. Even

if better solutions to content protection could be developed, peer-

to-peer services would seem to have an indefinite license to

ignore them, locking in Internet piracy as a permanent social

and economic problem.

3. The Seventh Circuit’s focus on the practical ability to

reduce or to eliminate copyright infringement is applicable only

where the defendant satisfies the Sony-Betamax staple article

test. For the reasons advanced by Petitioners, see Pet. at 20-24,

Amici do not believe that Respondents meet that test.

Respondents nevertheless have claimed that the Court in Sony-

Betamax foreclosed any inquiry into whether defendants meeting

that test can operate in a way that minimizes infringement.

According to Respondents, the only relevant inquiry under Sony-

Betamax is whether they offer a staple article capable of

substantial non-infringing uses. For several reasons,

Respondents are wrong.

First, Respondents’ argument is predicated solely upon

Justice Blackmun’s dissenting opinion in Sony-Betamax. Justice

Blackmun did suggest that a “jamming” device might have been

employed by broadcasters to prevent unauthorized home-

recording and that the Betamax could be sold without a “tuner.”

See 464 U.S. at 492 n. 42 & 494 (dissenting opinion). But the

majority in Sony-Betamax “did not discuss these possibilities.”

Aimster, 334 F.3d at 648. That lack of discussion does not mean,

as Respondents suggest, that the Court ruled irrelevant evidence

of whether the defendant could take reasonable actions to

eliminate or to reduce copyright infringement; it simply means

that the majority did not address the issue of alternative designs.

See Dawson Chem. Co. v. Rohm & Haas Co., 448 U.S. 176,

194 n.12 (1980) (“failure to discuss” suggests that the Court

“simply chose not to address a matter that had not been fully

presented”) (citation omitted).

It is not surprising that the majority in Sony-Betamax chose

not to deal with the legal significance of these alternative designs.

The district court specifically found, as a matter of fact, that

these alternative designs were impractical. See Universal City

Studios, Inc. v. Sony Corp. of Am., 480 F. Supp. 429, 462 (C.D.

Cal. 1979) (noting that a jamming system would “most likely

require the cooperation of many others: broadcasters, producers

and perhaps the Federal Communications Commission”);

id. at 435 (finding that tuners could be purchased separately

even if they were not originally included with the Betamax).

The Court thus resolved Sony-Betamax on the basis that it would

not be possible to both protect the copyright owners’ works and

permit non-infringing uses to continue. See 464 U.S. at 441

n.21 (noting that the plaintiffs in that case sought to declare all

VCRs “contraband”.

As one commentator has noted, the determination in Sony-

Betamax of

contributory infringement entailed an all-or-nothing

outcome; if the manufacturers were held liable, then

no machine could be distributed, despite its capacity

for non-infringing uses; if no liability, then the

machine can be distributed, despite its capacity for

infringing uses. Splitting the difference by limiting

distribution of the machine to a class of non-

infringers was not a possibility.

Jane Gmsburg, Copyright Use and Excuse on the Internet, 24

Cotum. V.L.A. J.L. & Arrs 1, 37 (2000) (further noting that

with Napster the “differences could be split; the online

technology makes possible the confinement of the service to a

class of non-infringers”). See also Reply Br. of Pets. in

Sony-Betamax, LEXsee 1981 U.S. BRIEFS 1687, at 7 (filed

Dec. 3, 1982) (stating that the “underlying important question

of federal law to be resolved implicitly by this decision is

whether the American public can be deprived of the technical

advance of home VTR reception of free off-the-air TV by two

programming with all other TV programming .. . [where] the

bulk of TV programming is available for unchallenged Betamax

reception”).

Second, the Court itself in Sony-Betamax suggested that

the staple article of commerce doctrine does not provide the

exclusive basis for determining secondary copyright liability.

The Court made clear that “the concept of contributory

infringement is merely a species of the broader problem of

identifying the circumstances in which it is just to hold one

individual accountable for the actions of another.” 464 U.S. at

435. Given the particular “circumstances” before it, the Court

in Sony-Betamax chose to borrow from patent law’s staple article

of commerce doctrine to determine secondary liability. But the

circumstances surrounding peer-to-peer services are dramatically

different than those that were present in Sony-Betamax and upon

which the Court based that choice:

* As the Court noted in Sony-Betamax, “the

average member of the public uses a VIR

principally” for lawful time-shifting. 464 U.S.

at 421. In contrast, at least 90% of the activity

on Respondents’ services involved copyright

infringement. Pet. at 9.

* The Court in Sony-Betamax noted that the

“only contact between Sony and the users of

the Betamax that is disclosed by this

record occurred at the moment of sale;” there

was no “ongoing relationship” between the

manufacturer and the infringer. 464 U.S. at 437-

38. In contrast, Respondents maintain such an

ongoing relationship with their users. See Brief

of Appellee Grokster, Ltd. at 39, Metro-Goldwyn

Mayer Studios, Inc. v. Grokster, Ltd., No. 03-

55894, 2003 WL 22762385 (9th Cir. filed Sept.

17, 2003) (noting that “of course” Grokster

“maintains an{] ongoing relationship with its

users ...”). Indeed, Respondents’ business

depends on continually serving advertisements

to their users.

The Court in Sony-Betamax emphasized that

that case did not involve any “issue concerning

the transfer of tapes to other persons.” 464 U.S.

at 425. In contrast, this case involves the

unauthorized distribution of perfect copies of

copynghted works to millions of computer users

around the world. See Register’s Statement,

supra note 2, at 6 (“In my view, if the VCR had

been designed in such a way that when the

consumer merely turned it on, copies of all the

programs he recorded with it were immediately

made available to every other VCR in the world,

there is no doubt the Sony decision would have

gone the opposite way.”).

The Court in Sony-Betamax emphasized that

that case involved only the private copying of

programs “broadcast on the public airwaves

without charge to the viewer” and not the

copying of programs transmitted for a fee on

pay or cable television. 464 U.S. at 421. In

contrast, this case involves the copying and

distribution of copyrighted works that the

owners market to the public for a fee.

In Sony-Betamax, it was not possible for Sony

to separate infringing from non-infringing uses

of the Betamax. That is not the case here. See

supra pp. 22-23.

Given these fundamental differences in the factual

circumstances between Sony-Betamax and the present case, it

does not follow that the only “just” basis, 464 U.S. at 437-38,

for imposing secondary liability on Respondents is the staple

article of commerce doctrine. As the Seventh Circuit has

properly concluded, justice (under the circumstances of this case)

requires imposing liability on Respondents and other peer-to-

peer services when they fail or refuse to take reasonable actions

to minimize the extraordinary level of copyright infringement

that they induce — regardless of whether Respondents also may

facilitate an incidental amount of lawful file-sharing. That

approach strikes the same “balance” the Court sought to strike

in Sony-Betamax.

Third, the Seventh Circuit approach — which permits a

finding of contributory liability where there are non-infringing

uses if the infringing uses are substantial — is consistent with

the patent law staple article of commerce doctrine. Historically,

a showing that an article used to infringe a patent was a “staple”

with substantial non-infringing uses simply supported an

inference as to a lack of “intent” on the part of the defendant.

But even where that showing was made, other conduct could

support a finding as to the requisite intent:

The presence or absence of the element of substantial

noninfringing use is significant principally in

determining whether there is an intention to infringe.

The absence of a substantial noninfringing use, of

course, warrants the inference of an intention to

infringe... . As to situations in which intention is

clearly established by other evidence, there is some

indication that suitability for noninfringing use is

no defense.

Fromberg, Inc. v. Thornhill, 315 F.2d 407, 414 n.20 (Sth Cir.

1963) (emphasis added) (citations omitted). See also Rupp &

Wittgenfeld Co. v. Elliott, 131 F. 730, 733 (6th Cir. 1904) (where

an inference as to intent cannot be drawn because the article

was “adapted to other uses,” the “‘intention to assist in

infringement must be otherwise shown affirmatively .. . ”),

quoting Thomson-Houston Elec. Co. v. Ohio Brass Co., 80 F.

712, 723 (6th Cir. 1897) (Taft, J.).

Consistent with the Seventh Circuit approach in Aimster,

courts in contributory patent infringement cases have considered

whether the defendants could take reasonable steps to eliminate

the infringing aspects of staple products. For example, in

Imagexpo, LLC v. Microsoft Corp., 284 F. Supp. 2d 365 (E.D.

Va. 2003), the defendant argued that it was entitled to summary

judgment because the allegedly infringing products (certain

software applications) were included in a suite or package of

software that had substantial noninfringing uses within the

meaning of 35 U.S.C. § 271(c). The court denied defendant’s

as to “substantial noninfringing use” (such as whether removal

of the offending applications from the suite would eliminate

infringement). As the court concluded:

“Additional functions in a device that practices a

patented method do[] not diminish direct

infringement and, therefore, the fact that the device

sold has other functions which are performed

simultaneously with the patented method does not

otherwise substantiate a noninfringing use for the

purposes of § 271(c). This rule flows directly from

the logic of patent laws. To hold to the contrary

would allow sellers of products that are clearly

intended to infringe a patented method to avert

liability simply by adding functions to that device.”

284 F. Supp. 2d at 368 (emphasis added), quoting Oak Indus.,

Inc. v. Zenith Elecs. Corp., 697 F. Supp. 988, 995 (N.D. Ii.

1988); accord, Philips Elecs. N. Am. Corp. v. Contec Corp.,

No. Civ A. 02-123-KAJ, 2004 WL 1622442 at *4-5 (D. Del.

July 12, 2004) (ordering defendant to remove the infringing

methods from its remote control that had noninfringing uses).

See also Oak Indus., supra, 697 F. Supp. at 996 (questioning

whether a “simple change ‘n design” would eliminate

infringement of the patent and further suggesting that the result

in Sony-Betamax might have been “different if reasonably

uncomplicated technology permitted a Betamax to differentiate

between temporary recovery for time-shifting and permanent

preservation of copynghted material”).

CONCLUSION

For the foregoing reasons, Amici respectfully urge the Court

to reverse the judgment below and to adopt the approach of the

Seventh Circuit in Aimster in determining the secondary

copynght liability of peer-to-peer services such as Respondents.

Peer-to-peer services should be secondarily liable forthe massive

that it would be disproportionately costly for them to eliminate

or to reduce substantially that infringement.

Respectfully submitted,

Ropert ALAN GARRETT

Counsel of Record

Gary GERTZ0G HapriaN R. Katz

Senior Vice President of STEVEN R. ENGLUND

Business Affairs and MicuHe.e J. Woops

Generali Counsel CHRIST OPHER WINTERS

NATIONAL FooTBALL LEAGUE ARNOLD & Porter LLP

280 Park Avenue 555 12th Street, N.W.

New York, NY 10017 Washington, D.C. 20004

(212) 450-2000 (202) 942-5000

Counsel for Amicus Counsel for Other Amici

National Football League

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