November 21, 2011
Metro-Goldwyn Mayer Studios, Inc. V. Grokster, LTD. (2005)
Posted by Erik under 14, Case Briefs[2] Comments
- Facts of the Case
Grokster, LTD. (and other associated companies) had distributed a free software program that served as a peer-to-peer network client – a program that allows users to connect their computers to one another directly and anonymously in order to transfer data. According to observed data, users of this software primarily utilized it to engage in the sharing of copyrighted materials, such as music or movies. According to court record, respondent companies encouraged and promoted the use of their software for this purpose and even profited from client use through the employ of streamed advertising services. Several movie studios (hence referred et al as “MGM”) alleged that Grokster and their associates intentionally distributed their software to serve such purpose, thereby infringing upon their copyrights as held by the Copyright Act. The district courts had ruled in favor of Grokster – their reasoning being that software distributors were not liable for any violations of copyright through the use of their software, as it was the software users responsible for infringement and completely possible to utilize said software for lawful purposes.
2. Legal Issue:
Are companies that openly distribute file-sharing software, encouraging and profiting from the copyright infringement resultant from the use of said software, liable for the offending infringement?
3. Decision:
In a unanimous decision, the Supreme Court held that companies that distributed such software and promoted its use for the infringement of copyright, were indeed to be held liable for any resulting acts of infringement.
4. Analysis:
The court’s decision was largely based on the fact that the software companies involved had advertised their product amongst their users for the purpose of sharing copyrighted materials. According to evidence present during the trial, the software was advertised as an alternative to the previously controversial “Napster” sharing client. This, according to the court, signified explicit intent to engage users in copyright infringing sharing. Also, the court noted that the nature of the developer’s source of revenue – internet ad streaming – was profiting off of increased traffic of potential infringing activities. Because the developer made more money through advertisements as more users connected, promotion of the software as a means to distribute and download copyrighted material was seen as a means to profit off of direct infringement of MGM et al. The Court also referred to a previous case in which Sony had been allegedly responsible for copyright infringement because it produced VCRs – which could be used to record copyrighted television programming. While the idea of “secondary liability” was discussed during that case, the Court held that the VCR was “capable of commercially significant non-infringing uses.” The Court insisted that, due to the nature of the advertisements and revenue source surrounding the file sharing client, that this case was not the same as the precedent.
5. Questions to Consider:
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- What is the significance of this case?
- What do you make of the change in legal precedent?
- Do you believe that companies that develop the software should be responsible for how users actually use the software? (In this case? How about in general?)
- Do you think that this case would be ruled differently today?
2 thoughts on “Metro-Goldwyn Mayer Studios, Inc. V. Grokster, LTD. (2005)”
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November 25th, 2011 at 11:16 am
1. The significance of this case is the precedent setting decision that software developers can now be held responsible for how their product is being used.
2. I agree with the courts on their decision. It is obvious that the software was designed to illegally obtain copyrighted material.
3. I do think that companies should be held responsible for their products use if the intended main use involves something illegal. I feel in this case it is not as though the people misusing the software had discovered a previously unknown yet illegal way to use this software. Instead (since Napster already existed) they created software with the intention of people using it mainly to perform illegal actions. I don’t think if people choose to use a product (say a kitchen knife to stab someone) in a way that was unintended from the company’s initial purpose it would be the same as this situation.
4. I think this case would be ruled exactly the same today as it was then. Courts have become much tougher on enforcing laws concerning copyright infringement.
November 28th, 2011 at 12:53 am
I agree with the Supreme Courts decision. Most of the time, the company that develops software, or really any product, should not be held responible for how their costumers use it.
But Grokster, LTD. seemed to be promoting the use of its software for illegal downloads and transfers. This can not be protected, since the company is selling its product if the idea of breaking copy right laws in mind.
I dont think it would be ruled any differently today. Ths case was rather recent and the views have not changed that much.