OPINION: Viacom v. Google brings back Grokster case

-- Video Business, 3/16/2007

Paul Sweeting is editor of Content Agenda

MARCH 16 | VIACOM INC.'S $1 BILLION LAWSUIT against YouTube and its parent company Google picks up where the Grokster case left off.

Although the Supreme Court’s 9-0 ruling in MGM v. Grokster was viewed as a sweeping victory for the studios against the peer-to-peer network provider, it left the most intriguing question raised in the case unresolved.

When the suit was first filed, Grokster and co-defendant StreamCast Networks tried to short-circuit the process by claiming they were protected by the so-called Betamax standard, as established by the Supreme Court in 1984.

Their peer-to-peer technology, the defendants argued, was legally no different from a VCR. Both are capable of infringing and non-infringing uses, and you can’t ban a technology that is capable of non-infringing uses simply because some people use it to infringe.

The district court ruled that the Betamax precedent did not apply to the facts in the Grokster case and ordered the case to proceed. Before it could, however, the defendants appealed the preliminary ruling to the U.S. Court of Appeals, which over-ruled the district court.

The appellate ruling was in turn reviewed by the U.S. Supreme Court.

Rather than addressing the question of whether Betamax applies to Grokster directly, however, the court declared that Grokster’s business model of promoting the availability of free music and movies on their network to attract an audience that appealed to advertisers, likely amounted to inducing people to commit copyright infringement.

If that were the case, the court said, then the question of whether Grokster’s peer-to-peer technology qualifies for protection under Betamax would be moot. The actions of Grokster the company would be illegal, and Grokster could therefore be held liable.

Since the question of inducement wasn’t properly before the court, however, the justices voted unanimously to send the case back to the district court for proceedings.

Before that could happen, though, the two companies basically collapsed and their cases were settled.

THAT LEFT HANGING the question of what sorts of business models or behavior could be deemed an inducement to others to infringe.

Viacom’s suit against Google, however, promises to hit the question square on. And the answer could hold profound implications for the commercial development of new distribution technologies.

YouTube has long claimed that it is protected from liability by the safe-harbor provision built into the Digital Millennium Copyright Act.

That provision was inserted into the law at the urging of major ISPs such as Verizon and AT&T, which feared being sued as contributory infringers by virtue of providing the technology Internet users could use to infringe copyrights.

Under the compromise hammered out, ISPs would be immune from liability for contributory infringement if they agreed to remove unauthorized copyrighted works from their network when requested by the copyright owner.

YouTube claims that its role in the actions of its users is no different from an ISP’s role. So long as it complies with all notice-and-takedown requests—as it claims to—it should be protected.

Count IV of Viacom’s complaint, however, charges Google with operating the YouTube Web site “with the object of promoting its use to infringe plaintiffs’ copyrights and, by their clear expression and other affirmative steps … unlawfully fostering copyright infringement by YouTube users.”

In other words: The actions of YouTube the company, like Grokster’s, amount to an inducement to infringe. And if that’s the case, as the Supreme Court strongly implied, the question of whether YouTube qualifies for the DMCA safe-harbor is moot.

WHAT MAKES VIACOM V. GOOGLE particularly intriguing to those who follow copyright and technology policy issues is the resources both sides can draw on.

Unlike Grokster and StreamCast, which were essentially start-ups, Google is one of the largest companies in the U.S., with cash reserves of over $11 billion on its balance sheet.

While there might be sound business reasons for Google to settle the case with Viacom, it certainly won’t get financially overpowered, as Grokster did.

Should the two sides dig in their heels, each has the resources to see this one through to a final decision, no matter how high in the courts it needs to go to reach one.

Paul Sweeting is editor of Content Agenda. Get more of Sweeting's analysis here.

Talkback

» SUBMIT FEEDBACK

This is a frivilous lawsuit. Just a....
Jaleel Kairi - 11/01/07

» MORE

Related Content

• Topics
• Author

Related Content

 

By This Author

There are no other articles written by this author.

Sponsored Links