Indirect Copyright Liability: A Re-Examination of Sony's Staple Article of Commerce Doctrine

Abstract

This article is based on an amicus brief filed in METRO-GOLDWYN-MAYER STUDIOS INC., et al., v. GROKSTER, LTD., a case before the U.S. Supreme Court addressing indirect copyright liability for distribution of software that facilitates file sharing on peer-to-peer (P2P) networks. This case turns on whether the Supreme Court's landmark decision in Sony Corp. v. Universal City Studios, Inc., 464 U.S. 417 (1984), effectively immunizes the software distributors in this case from contributory or vicarious liability on the grounds that such software is capable of substantial non-infringing use.

The article re-examines Sony's jurisprudential foundation. In that case, the Court transplanted an express categorical limitation on indirect liability from the Patent Act into the Copyright Act, notwithstanding that Congress had only recently reformed the Copyright Act without including any such limitation on liability among the many express exemptions, limitations, and immunities contained in the statute. Furthermore, Congress reaffirmed the continued applicability and evolution of infringement standards through case-by-case adjudication. The Sony decision failed to examine the important differences between patent and copyright protection. Whereas patent law seeks to promote technological innovation and evolved a staple article of commerce doctrine primarily out of concern for unduly expanding patent scope, copyright law seeks to promote cultural and social progress, manifesting a more cautious stance toward technological dissemination, particularly where a technology threatens widespread piracy of expressive works. Products that encourage patent infringement do not threaten harm beyond a single patent or cluster of patents, whereas the technology at issue in the Grokster case threatens systemic harm to the copyright system by promoting rampant unauthorized distribution of all manner of works of authorship. Therefore, the uncritical transplantation of Patent Act's immunity for dual-use technologies into the Copyright Act poses grave dangers that were beyond the Supreme Court's view when it decided the Sony case in 1984, before the digital revolution took hold. Furthermore, amendments to the Copyright Act since the Sony decision demonstrate that Congress does not believe that dual-use technology - i.e., technology that is capable of both infringing and substantial non-infringing uses - should be treated as inviolate under copyright law. Rather, Congress has shown that it sees a need to balance the efficacy of the copyright system for promoting creative expression against social interests in technological innovation and consumer autonomy.

Keywords: Copyright, Patent, Contributory Liability, Indirect Liability, P2P

JEL Classification: O34, Z10