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Abstract

Millions of people download billions of music files over the Internet, using peer-to-peer ("P2P") services such as Grokster, StreamCast, Morpheus, and Kazaa. This practice has been challenged as violative of copyright and, it has been argued, the magnitude of copyright violations facilitated by P2P services justifies banning the services entirely. This argument has been based on the assumption that most transfers over P2P services violate copyright. The starting point for this discussion is the recent decision of the United States Supreme Court to grant the certiorari petition of Metro-Goldwyn-Mayer Studios et al. to review the Ninth Circuit decision in MGM v. Grokster. In that decision the Ninth Circuit affirmed the district court's grant of partial summary judgment in favor of Grokster, holding that Grokster did not materially contribute to the primary infringement and the software was being used to transfer a commercially significant number of non-infringing files. The author then proceeds in a more thourough examination of the established legal doctrines and the arguments posed by both sides. After a short presentation of the peer-to-peer (P2P)distribution technology by which files are transferred over the Internet but the information available for access does not reside on a central server, the author proceeds in exploring the basic assumption that most P2P transfers are infringing. Using the applicable principles of copyright law, those assumptions are analyzed and by applying current well-established law, two theories which contradict that assumption are identified: a significant number of individuals who transfer files over P2P networks may have a license to do so, and provisions of the Copyright Act itself may exempt the transfer of certain categories of entertainment files over P2P networks from the definition of infringement. Finally, the author concludes that since both sides agree that Sony v. Universal City Studios controls the issue, unless the Supreme Court decides to overturn Sony, or divines a third interpretation which the parties have not argued, no secondary liability for copyright infringement can be found under either of the two interpretations of Sony is chosen unless a substantial degree of primary liability, linked to the alleged secondary infringer, has been established.