'Public is winner' in Supreme Court's electronic file-sharing case, says IEEE-USA

06/30/05

Court protects technological innovation in MGM vs. Grokster

WASHINGTON (30 June 2005) -- "The public wins in the Supreme Court's unanimous decision in the electronic file-sharing case announced on 27 June," according to IEEE-USA Intellectual Property Committee Chair Andy Greenberg. Greenberg, who filed IEEE-USA's amicus curiae brief in the MGM vs. Grokster case last January, said that the Court achieved a balance between protecting against copyright infringement and promoting technological innovation. According to IEEE-USA's Greenberg, the Court recognized "the interests of artists in their work and the interests of the public to have access to dynamic and innovative technologies for obtaining and enjoying those works." As a result, IEEE-USA asserts, the public is ensured continued access to music, art and technology.

In the Court's 9-0 opinion, Justice David Souter wrote that "one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties." The Supreme Court adopted an active inducement standard as advocated by IEEE-USA in its amicus brief filed with the Court. The decision imposes liability on companies that actively encourage or "induce" customers through words and deeds to infringe on copyrighted material, which focuses legal scrutiny on the company's infringing conduct rather than restricting its technology.

According to Justice Souter, the active inducement rule "does nothing to compromise legitimate commerce or discourage innovation having a lawful promise." He added that patent law's commerce doctrine, now codified, "leaves breathing room for innovation and a vigorous commerce."

Innovation will not be stifled, according to Justice Souter, who said: "We are, of course, mindful of the need to keep from trenching on regular commerce or discouraging the development of technologies with lawful and unlawful potential...The inducement rule...premises liability on purposeful, culpable expressions and conduct, and thus does nothing to compromise legitimate commerce or discourage innovation having a lawful promise."

IEEE-USA's Greenberg noted: "Active inducement has been part of patent law for more than 100 years, and has stood the test of time. In all that time, the sky has not fallen for technology companies in patent law," and it can be assumed "that a parade of 'horribles' will not follow under copyright principles."

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