Intellectual Property in Peer-to-Peer Networks

Artsiom YautsiukhinNatallia Kokash

Intellectual Property Law, 18 October 2005

Contents Introduction Copyright and P2P file sharing

• Copyright Infringement• Betamax defense

Law Cases• A&M Records v. Napster• The Aimster case• MGM v. Grokster• BUMA v. KaZaA• MPAA and RIAA v. The People

Defense strategies Conclusion

Introduction

Peer-to-Peer (P2P) - a network in which each computer shares and uses devices on an equal basis (Ex: Napster, Aimster, Grokster, KaZaA, Scour, Audiogalaxy).

P2P is used for the exchange of text, image, sound and video files. These include works protected by copyright.

Copyright & P2P design

Copyright law concerns:• Users of P2P networks

• Developers of core P2P file-sharing technology (underlying protocols, platform tools, client implementations)

• Developers of ancillary services for P2P (providers of search, security, metadata aggregation)

P2P and Copyright Infringement

The end-users • Direct Infringement

The P2P tool maker ~ ”wheel man”• Contributory infringement

• Direct Infringement

• Knowledge

• Material Contribution

• Vicarious infringement• Direct Infringement

• Rights and Ability to Control

• Direct Financial Benefit

Betamax defense

Sony v. Universal City Studious: Sony Betamax VCR is capable of several non- infringing use (time-shifting of television broadcasts)

“Betamax defense” - to prove capability of non-infringing applications, irrespective of the proportion of infringing to non-infringing uses

The Napster Case Contributory infringement:

• Direct Infringement: (at least) some users

• Knowledge: company e-mails, song titles in promotional screen, experience

• Material Contribution: site and facilities Vicarious infringement:

• Right and Ability to Control: Napster retains the right to block a user’s ability to access its system

• Financial Benefit: Napster’s value is derived from the size of it’s user base

The Aimster Case

The same claims as in the Napster case Aimster prospect: the network traffic was

encrypted allegedly making it impossible to know what files were being shared by end-users

Betamax defense failed because:• Aimster failed to introduce any evidence of non-

infringing uses

• Had clear knowledge of infringing activities (“tutorials” encouraged users to download copyrighted music)

The Grokster Case (+ KaZaA, Morpheus)

Betamax defense: project e-books, promotional music videos, video game demos

Contributory infringement:• Knowledge: decentralized architecture, did not have

knowledge (e.g. Xerox)

• Material contribution: did not provide “site and facilities”, very limited involvement with the network

Vicarious infringement:• Right and Ability to Control: no ability to supervise and

control users

The KaZaA Case

Licensing agreement to listen music within the network without downloading

Negotiations were interrupted by Buma copyright infringement by KaZaA

The Court obliged:• Buma to continue the negotiations

• KaZaA to redesign the system

But KaZaA succeeded in appeal! Decentralized architecture!

MPAA and RIAA v. The People

The Motion Picture Association of America (MPAA) - lawsuits against individuals using P2P file-sharing software to access movies.

Recording Industry Association of America (RIAA) - lawsuits against individuals who use file-sharing software.• 6,000 lawsuits against music file sharers

since September 2003.

Defense strategies

“All my users are innocent”. “Capable of substantial non-infringing uses”. “Safe harbors”

• transitory network transmissions

• caching

• storage of materials on behalf of users (remote file storage, web hosting)

• provision of information location tools (providing links, directories, search engines)

Conclusion

Lessons for Peer-to-Peer developers… Make and store no copies. Your two options: total control or total anarchy. Better to sell stand-alone software products than on-going

services. What are your substantial non-infringing uses? Do not promote infringing uses. Don’t make your money from the infringing activities of

your users. Give up the EULA. No direct customer support. Be open source.

References

Intellectual Property - Peer-to-Peer (P2P) File Sharing, http://www.eff.org/IP/P2P• “IAAL*: What Peer-to-Peer Developers Need to Know

about Copyright Law”

• “The Electronic Frontier Foundation’s (EFF) Efforts to Protect P2P “

• “MGM_v_Grokster”

• “Napster”

• “BUMA_v_Kazaa”

• “MPAA v. The People”

• “RIAA v. The People”