Groksters Lingering Effects

The Supreme Court's Grokster decision increases the importance of a fair-use law.

It has been a few weeks since the Supreme Court handed down its landmark Grokster decision, but, since then, I havent seen too many suggestions about what people can do to make sure the decision does not negatively affect innovation or limit fair-use rights.

First, heres my quick take on the effects of the Grokster decision: It was pretty much a classic "everyone loses" decision, with only illegal file sharers getting out with almost no ill effects. Makers of file-sharing software, especially those that are a little sleazy, clearly got whacked. And, as has been said in many areas, technology companies will experience a chilling effect as they worry about innovating and how far the entertainment industry will go in challenging them.

But, it may surprise some people to learn that the entertainment industry was also a loser in the Grokster case. It didnt get anything close to what it wanted, which was a complete rejection of the fair-use principles of the Supreme Courts previous Betamax decision. Legitimate companies will still be able to make products that Hollywood doesnt like, and, by being seen as a big winner in the Grokster case, it is now much harder for the entertainment industry to go running to Congress to get the results it really wanted.

However, the Grokster decision still has a lot of potential to cause harm, as a chilling legal threat to both innovation and fair-use rights. The latter is especially ominous because fair-use rights have never been officially written into U.S. law.

A proposed bill, H.R. 107, the Digital Media Consumers Rights Act, by Rep. Rick Boucher, D-Va., can remedy this by putting the concept of fair use clearly into law. (The bill is co-sponsored by Congressman John Doolittle, of California.)Most important, the bill, first introduced in 2002, mitigates the negative effects of the disastrous DMCA (Digital Millennium Copyright Act) by making it legal for consumers to circumvent copyright protection technologies if the purpose is for fair use(such as backups, time shifting and other reasonable uses).

/zimages/2/28571.gifClick here to read more about Jim Rapozas take on fair use.

Boucher recently took some time to talk to me about the Grokster decision and his bill. He said he thought the Supreme Court did a good job with the Grokster decision, saying that the Court "threaded the needle pretty well."

I agreed with Boucher when he said that if one reads the Courts decision, it is pretty clear that a business would have to be actively marketing and intending to induce copyright infringement to fall afoul of the law. But I also agreed with him when he said, "We are likely to go through a series of lawsuits in the next few years where the entertainment industry will try to push the envelope."

Anyone familiar with the excesses of the DMCA realizes that lawyers will bring highly suspect charges against companies, all the while knowing that they dont need to win in the end to chill innovation and force companies to decide that new technologies arent worth the legal hassles.

People also need to understand that the normal persons idea of whats legal doesnt always jibe with what the entertainment industry thinks is legal. After the Grokster decision, I heard many people say something like, "Get those darn file sharers—all my MP3s are legal ones I ripped from CDs I own." But guess what? There are still many people in the record industry who contend that ripping CDs constitutes copyright infringement. In fact, a former record industry head once referred to Apples Rip, Mix and Burn campaign as a big "bleep you" to the record companies.

This is why we need Bouchers bill more than ever. And now might be the perfect time to get it passed. Since the Grokster decision is widely seen by most as a big win for the entertainment industry, it will be easy to argue that Congress needs to pass this bill to restore some balance for consumers.

Boucher has an even better reason for why theres no time like the present: "I think the time is right for us not because of Grokster but because of the Broadcast Flag ruling."

For those not familiar with the Broadcast Flag ruling, a federal court recently ruled that the Federal Communications Commission couldnt force electronics makers to include a capability that would allow broadcasters to control how viewers recorded or shared television shows.

Because of that decision, the entertainment industry is lobbying to give the FCC just that right, and Boucher and many of his key colleagues have agreed that if people in the entertainment industry want that right, they will have to sign on to Bouchers bill and support putting consumer fair-use rights into law.

So what can you do to limit the negative effects of Grokster? I know Ive said it before, but write to your representatives in Congress. Let them know that, given the entertainment industrys win in the Grokster case, Congress needs to make sure that Hollywood doesnt go too far, that consumers have the right to use content in legitimate ways and that companies can innovate without fear of litigation.

And then fair use wont only be a right, it will be the law.

Labs Director Jim Rapoza can be reached at

Following are some resources to help those interested in supporting Bouchers DMCRA bill and learning more about the effects of the Grokster decision:

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