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Computer Law Review and Technology Journal

Abstract

In 1984, the U.S. Supreme Court dealt a major blow to television and movie studios in their fight against creeping copyright infringement. Sony Corp. of America. v. Universal City Studios, Inc. (Sony-Betamax) declined to hold the Sony Corporation liable for the copyright violations its consumers committed by using the new Betamax video tape recorder (VTR) to build immense libraries of broadcast television programs without permission from the programs' copyright holders. Taking a nod from patent law, the Court classified the VTR as a "staple article of commerce," effectively excusing its manufacturer from secondary copyright infringement because the recorder had a "commercially significant non-infringing use." Recently, in Metro-Goldwyn-Mayer Studios, Inc. v. Grokster,Ltd., the Ninth Circuit relied on Sony-Betamax to find distributors of peer-to-peer ("P2P") file-sharing software not liable for their users' infringement of copyrighted music and motion pictures. However, the Ninth Circuit misapplied the Sony-Betamax analysis. It improperly extended the staple article of commerce defense to the Grokster defendants' file-swapping software and lowered the benchmark for commercially significant non-infringing uses. The Ninth Circuit further erred in dismissing the plaintiffs' arguments for a constructive knowledge standard. Thus, the court strayed from the important public policy articulated in Sony-Betamax, which the Ninth Circuit recognized as the "seminal"s case on contributory copyright infringement. It also deviated from the trend in the circuit courts to impose secondary liability on P2P providers for their users' direct copyright infringement. Consequently, the court opened the door to massive copyright erosion in cyberspace.

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