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ObviousNews.com | Entertainment News | a collection of the overt Entertainment Biz Preps for Day in Court Three men will stand before the U.S. Supreme Court (news - web sites) March 29, arguing one of the most important copyright cases in history. One will speak for most of the entertainment industry. The second will argue for two companies that provide peer-to-peer file-sharing software, and the third will represent the U.S. government. Experts agree that the court's written opinion in case No. 04-480 will have a profound impact on federal legislation, business models, law enforcement and the financial resources of industries that have provided an estimated 6% of the country's gross domestic product. Its legal and practical effect will touch the entertainment, technology and copyright industries -- and nearly everyone who earns a living in these sectors. The issue before the Supreme Court is whether two companies that operated, and continue to operate, "decentralized" P2P file-sharing networks should be liable for the copyright-infringing activities of their users, who have shared more than 8 million unauthorized music and movie files. While the technology is capable of lawful use -- sharing files of public-domain works and copyrighted works provided with the owners' permission -- the evidence suggests that more than 90% of the copyrighted works on these networks were not authorized to be shared. APPELLATE DECISION The case landed in the Supreme Court after the Ninth Circuit Court of Appeals in Pasadena, Calif., held last August that Grokster and StreamCast Networks, as operators of certain versions of Grokster and Morpheus, respectively, were not secondarily liable for their users' infringements. The case is still pending as to other versions of the software and against other parties in the U.S. District Court in Los Angeles. As the day for oral arguments draws near for Metro-Goldwyn-Mayer Studios Inc., et al. v. Grokster Ltd., et al., many interested parties and observers around the world are discussing the case. The focus in Washington, D.C., however, is on the positions of the parties to the lawsuit and the more than 200 amici (friends of the court) as revealed in their briefs filed with the court. Donald B. Verrilli Jr., a partner with Jenner & Block in Washington, D.C., will be arguing for the "petitioners" -- the entertainment industry parties. Their briefs focus on the activities of Grokster and StreamCast Networks, rather than on the P2P technology, Grokster and Morpheus. SECONDARY LIABILITY The petitioners say copyright law imposes secondary liability on "gatekeepers" -- or intermediaries -- that facilitate infringement. They argue that under this legal theory, any company operating a service "principally" for infringing activities -- even if the technology is "capable" of being used for non-infringing purposes -- should be liable for secondary infringement, especially when the company could prevent the infringing uses. The petitioners argue that Grokster and StreamCast actively encouraged and assisted infringement by "promoting themselves as sources of infringing content" and by "deliberately disabling and avoiding mechanisms that would limit infringement." Richard G. Taranto, a partner with Farr & Taranto in Washington, D.C., will argue for Grokster and StreamCast. The companies focus their brief on their technology, emphasizing that it is "capable of significant non-infringing use." They argue that this is the current legal standard that guides their activities, and that simply having general knowledge that many will use their software for infringing purposes does not subject them to liability. The companies also argue that only Congress "is institutionally suited to consider the challenges presented by decentralized" P2P file searching and sharing, to assess its real-world effects and decide when legislative intervention is advisable BIBLICAL PROPORTIONS With two P2P companies on one side and 38 entertainment companies plus a certified class of 27,000 songwriters and music publishers on the other, the image of David fighting Goliath could come to mind -- if not for the fact that many powerful companies filed amicus briefs supporting the position of Grokster and StreamCast. More than 200 individuals, companies, trade groups and nonprofit organizations, representing "hundreds of thousands" of parties worldwide who believe the decision will seriously affect them, filed 55 amicus briefs with the Supreme Court. About 100 parties -- among them major telecoms, technology companies and a trade group representing more than 450 U.S. venture capital firms -- are urging the court to affirm the appellate decision in favor of the P2P companies. One of these parties, Intel, the world's largest semiconductor manufacturer, sees a reversal of the decision as having a chilling effect on technological innovation. The American Civil Liberties Union (news - web sites), the American Library Assn. and others urge the court to affirm the decision but to adopt an interpretation of the law that promotes free speech and innovation on the Internet while protecting legitimate copyright interests. The U.S. government, represented by Acting Solicitor General Paul Clement, and more than 100 other parties support the entertainment industry and want the decision reversed. These include the Business Software Alliance, the National Association of Recording Merchandisers and 40 state and territory attorneys general, who believe that permitting Grokster and StreamCast to evade liability would undermine secondary liability doctrines and foster lawlessness and an unaccountable business culture. Others support neither side; they seek a clarification of legal guidelines. ON HOLD While the case is pending before the Supreme Court, the Senate is standing by for the decision before moving ahead with legislation on related copyright issues. The House is also in a holding pattern. "We're not going to do any major legislation until after the Supreme Court decides Grokster," Rep. F. James Sensenbrenner (news, bio, voting record) Jr., R-Wis., chairman of the House Judiciary Committee (news - web sites), told Billboard. Legal experts are not even attempting to predict whether the court will affirm or reverse the appellate court decision. Since the Supreme Court is not required to hear appeals, however, agreeing to review the case means that it will create new rules or attempt to clarify old ones for the digital age -- most likely the latter. The decision is expected to be made before the court adjourns for its summer recess. -- ----------------- R. A. Hettinga <mailto: [EMAIL PROTECTED]> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire' ------------------------ Yahoo! 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