20 August 2004

The Spin Cycle

I'm not even going to try to keep up with all of the bullshit flying in the blogosphere about the Grokster opinion, which has already been spun so far by advocates of various extreme positions that a reasonably sophisticated nonlawyer might think that at least three different and incompatible opinions were issued yesterday. For example, one individual (whose analysis is generally much better than this) simply quotes part of the Ninth Circuit's concession that it believes it is creating a circuit split with the Seventh over Aimster without noting three critical contextual issues that would completely change one's interpretation of both opinions:
  • In Aimster, there was substantial evidence in the record—as in Napster—of the principal's intent to facilitate widespread infringement. This evidence was apparently absent in Grokster. By itself, I think this distinction is enough to vitiate any purported circuit split. It's not that I think the Software Distributors in Grokster were saints who just wanted to play with a kewl technology; it's that sufficient evidence of intent to facilitate not just file transfer, but infringing file transfer, was not entered against them in the trial court.
  • In Aimster, the appeal was against a preliminary injunction granted by the trial judge, which gets a helluva lot of deference based on the trial judge's ability to review the evidence. That put a big thumb on the scales that resulted in the Seventh Circuit's affirmance. Contrariwise—this entire dispute resembles Tweedledum and Tweedledee—in Grokster, the underlying ruling affirmed on appeal had been in favor of the Software Distributors.
  • Perhaps most importantly, the facts as explained in the opinions are just plain incompatible. In Aimster, the facts before the court indicated that each user of the system had to register with it prior to downloading (there's the "ability to control" issue on which Grokster et al. evaded vicarious liability), and substantial indexing information was stored on Aimster's own servers (there's the "material contribution" absent in Grokster—and, in fact, specifically cited as something that quite probably would have swung the opinion the other way by Judge Thomas; compare Aimster, slip op. at 3, with Grokster, slip op. at 11739:

    In the context of this case, the software design is of great import. As we have discussed, the software at issue in Napster I and Napster II employed a centralized set of servers that maintained an index of available files. In contrast, under both StreamCast’s decentralized, Gnutella-type network and Grokster’s quasi-decentralized, supernode, KaZaa-type network, no central index is maintained. Indeed, at present, neither StreamCast nor Grokster maintains control over index files. As the district court observed, even if the Software Distributors "closed their doors and deactivated all computers within their control, users of their products could continue sharing files with little or no interruption."

The irony that everyone thus far seems to be missing—and it is not even cited in Grokster—is that the DMCA has a specific safe-harbor for certain kinds of indexing activities, 17 U.S.C. § 512(d). This is probably because the Software Distributors, even if they had invoked this safe harbor, could not have sailed into it: They fail to meet two conditions (no financial benefit when aware of infringement, and removal of links to infringing material when notified). Nonetheless, it is somewhat curious that Judge Thomas did not cite to the general scope and structure of this particular safe harbor, because its reasoning pretty closely parallels his analysis of the contributory infringement theory.