Ruling Against Grokster Might Have Unexpected Effects

Another chapter of the fight against piracy and illegal downloads has just been closed, as all nine justices of the U.S. Supreme Court had a 9-to-0 ruling, according to which, from now on, file-sharing services can be held liable for theft.

This decision, taken in the in the MGM versus Grokster case, will have a decisive influence on the development of the digital industry. From now on, companies developing digital media products will have to make sure they can't be sued for contributing or inadvertently encouraging copyright infringement. If there's a chance that their customers could misuse their product in a way that infringes on copyrights held by media companies, manufacturers and service providers will have to show they're making efforts to stop the infringement once it's discovered, and to prevent it from happening in the first place.

"The record is replete with evidence that from the moment Grokster and StreamCast began to distribute their free software, each one clearly voiced the objective that recipients use it to download copyrighted works, and each took active steps to encourage infringement," Justice David Souter wrote in the court's opinion.

Souter noted that both companies have tried to capitalize on the disappearance of the Napster music file-sharing service. The opinion even cited an internal e-mail describing how Grokster executives wanted to use marketing campaigns to position its service in such a way as to attract Napster users once Napster ceased to operate as a file-sharing service.

Michael Neco, StreamCast's general counsel, called the Supreme Court's decision "Orwellian" and described lawyers for media companies as "the new thought police."

Neco also said that "The guy in the garage and the guys in the executive suite had better be smart about what they say and do, because every thought and action they take will be subject to discovery by a lawyer. Lawyers are going to get pulled into every aspect of the technology business."

This court ruling actually marks the beginning of a new era. The phenomenon of piracy has received somewhat of a death penalty and is now being carried towards the gallows pole. But, given the huge number of people involved in such practices, we're sure that its death will be a slow and painful one.