Famous Cases

Quick Guide to Famous Patent Cases

Quick Guide to Famous Patent Cases

Patent cases from the past have implications on future patent infringement cases. The arguments presented in past cases allow for statutes to be created or examples of how statutes are followed help plaintiffs and defendants determine if they have a shot at winning a civil suit over patent infringement. While some cases may be simple resulting in summary judgment to one side, other cases have to closely examine details of the case as well as past cases to apply precedents to help form a decision.
Most patent infringement cases are based on statutes or phrases, such as sovereign immunity, public use, flash of genius and obviousness, among others. When the law is not clear and two sides both believe the other is in the wrong, past cases will give each side a good idea as to how the court will rule an infringement case.
Some famous patent cases include:
Pennock v. Dialogue
Grant v. Raymond
Electric Storage Battery v. Shimadzu
Cuno Engineering v. Automatic Devices Corp
Hotchkiss v. Greenwood
 
Blonder-Tongue v. University of Illinois
State Street Bank v. Signature Financial 
Florida Prepaid Post-Secondary Education Expense Board v. College Savings Bank
KSR v. Teleflex. 

Florida Prepaid Post Secondary Education Expense Board v. College Savings Bank

Florida Prepaid Post Secondary Education Expense Board v. College Savings Bank

The issue of
sovereign immunity was raised in the Florida Prepaid Post-Secondary Education
Expense Board v. College Savings Bank case from 1999. The plaintiff, College
Savings Banks, filed a patent infringement suit against the defendant, Florida
Prepaid. The defendant was a State entity. The Court ruled in a 5-4 vote that State
sovereignty could not be taken away even though the Patent and Plant Variety
Protection Remedy Clarification Act says differently.

Case Description

The plaintiff filed a suit against the defendant
which happened to be a State entity. The plaintiff claimed the Patent and Plant
Variety Protection Remedy Clarification Act takes away sovereign immunity — or
immunity from liability — from states. The defendant claimed the Seminole
Tribe v. Florida outcome declared sovereign immunity could not be taken from
the State.

The
plaintiff relied on the 14th Amendment which gave the State no power to take
away property without due process, which included patent properties. The defense
claimed no law passed by Congress shall be able to curtail the protection held
by the states from patent infringement suits.

Ruling

In a 5-4 vote, the Supreme Court ruled the Patent
and Plant Variety Protection Remedy Clarification Act could not take away
sovereign immunity from the State of Florida. The Court said only a consistent
disregard for the property rights and patent rights of citizens could permit Congress
to take away sovereign immunity from a State. Since the plaintiff could not
prove the defendant demonstrated consistent patent violations, the State’s
protection in the form of sovereign immunity would remain.

Apple Computer, Inc. v. Franklin Computer Corp

Apple Computer, Inc. v. Franklin Computer Corp

In the Apple
Computer, Inc. v. Franklin Computer Corp. copyright infringement case, Apple
Computer, Inc., now Apple Inc., decided to name Franklin Computer Corporation in
a lawsuit in regards to the recent release of an operating system the company
had been distributing.  Apple Computer, Inc. said that there was a direct
parallel to the operating system that the company itself had developed and
released and the new,
 Ace 100, by the Franklin Computer
Corporation. 

Apple
Computer, Inc. filed the copyright infringement case at the United States
District Court for the Eastern District of Pennsylvania.  The filing of
Apple Computer, Inc. on May 12, 1982, marked the date of the first copyright
infringement case to be litigated on a matter involving an operating system in
a high court.

Apple Computer, Inc. had released the operating
system,
 Apple II, in 1977 at the West Coast Computer
Faire.  It was designed by engineer and co-founder of the company, Steve
Wozniak, along with other members of the team. 
 Apple II proceeded Apple I, a personal
computer, which was the company’s first product release.  The basis of the
copyright infringement case was the claim of Apple Computer, Inc., which stated
that Franklin Computer Corporation, a consumer electronics manufacturer, had
been distributing a replica of
 Apple II in their release of the Ace 100 in
1982. 

One of the
largest arguments by Apple Computer, Inc. in the copyright infringement case
against Franklin Computer Corporation was that the operating system,
 Ace 100, had included some of the same mathematical logic and language
for the ROM as
 Apple II.  Another major
citation on the basis of the copyright infringement case against Franklin
Computer Corporation was that
 Ace 100 featured a similar
motherboard scheme to that of
 Apple II.

The position of Franklin Computer Corporation in
the copyright infringement case was that, although the company had used many of
the concepts from
 Apple II in their creation of the Ace 100, it would
not have been quite as constructive or effective for the company to attempt at
creating a brand new operating system.  The Franklin Computer Corporation
stated that the product would not have the capacity to achieve compatibility if
starting completely from scratch. 

The company
went on to state that some components of the
 Apple II operating system were not copyrighted, so therefore they took on
the implication that they could be copied.  The Franklin Computer
Corporation added to their defense in the copyright infringement case by
stating that they were in the midst of producing software that would be
completely independent.

The United States District Court for the Eastern
District of Pennsylvania declared the copyright infringement case of Apple
Computer, Inc. v. Franklin Computer Corp. in favor of Franklin Computer
Corporation.  Dissatisfied with the verdict, Apple Computer, Inc. filed
for an appeal with the United States Court of Appeals for the Third
Circuit.  By mid-1983, and just three business days after the District Court
had ruled in the favor of Franklin Computer Corp., the Federal court issued a
verdict in the copyright infringement case for Apple Computer, Inc. 

The stated basis
for the ruling was that a program is protected under copyright law even if it
is written in a combination of print and object code. The ruling had important
implications for the enforcement of copyright on computer programs.

Baker v. Selden

Baker v. Selden

Baker v. Selden (101 U.S. 99)
is one of the earliest and most important of all copyright infringement
 cases. It is heavily cited in
explaining the idea-expression divide, a concept that outlines the underlying
concepts of copyright laws. It explains that U.S. copyright laws are set into
place to protect the expression of an idea rather than the idea itself. The
case, which took place in 1879, concluded that the exclusive rights to what is
known as “useful art” which may be written in a book are only
protected under U.S. intellectual property law through a patent. The
description itself contained in the book would be protected under copyright.

Background

A man by the name of Charles Selden obtained a
copyright for a book he wrote which was intended to portray an improved system
of bookkeeping entitled Bookkeeping Simplified. The book, although containing
only 650 words, contained mostly bookkeeping forms. There were also several
examples outlined in addition to an introduction.

Selden
created several additional books, which were arguably just new revisions to the
same original book. Selden was unsuccessful in selling his books, even after
attempting to sell them to several counties, as well as the United States
Department of Treasury. Before Selden’s death, he assigned his interest, which
was returned to his wife.

W.C.M Baker produced a book in 1867 which
described a very similar system to Selden’s system of bookkeeping. Baker was
able to sell the book to 40 counties in under five years. It was not long
before Selden’s widow, Elizabeth, discovered Baker’s success with Selden’s
similar bookkeeping techniques. She hired an attorney and took legal action
against Baker in 1872 and sued him for copyright infringement.

The Trial and Appeal

The court decided that Baker’s books contained
information and material which was too similar not to be liable for copyright
infringement. As a result, the court ordered a permanent injunction which
prevented Baker from further publication or sale of his book. Baker and his
legal team immediately filed an appeal to the Supreme Court of the United
States, which claimed that Selden’s work is not valid copyright subject matter.

The appeal process closely
examined the difference between patent law
 and copyright law. It
was found by the Court that the idea contained within a book is not enforced
through copyright law, but rather through patent law. Only the description or
expression of an idea is protected by a copyright. Justice Joseph P. Bradley
wrote of the case, “The copyright of a book on bookkeeping cannot secure
the exclusive right to make, sell, and use account books prepared upon the plan
set forth in such a book.” Baker v. Selden has been written into the U.S.
Code §102(b) of the Copyright Act.

Importance of Knowing The Famous Cases of Copyright Law

Importance of Knowing The Famous Cases of Copyright Law

Famous copyright lawsuits over the years have played a large part in how copyright law is shaped today in the United States. The decisions made in early court cases have helped to distinguish between copyrights and patents, pinpointing a clear definition for both aspects of United States Intellectual Property Law. In addition, with the emergence of digital technology came new amendments in copyright laws, including the Digital Millennium Copyright Act.
Important court decisions have helped to firmly establish the laws outlined in this Act, becoming a model for future court disputes. For example, one of the more famous copyright cases, Viacom vs. Youtube, Google Inc., showed how important it is for copyright laws to keep up with the fast paced world of technology, while firmly placing responsibility into the hands of companies who manage websites with user-controlled content. Baker v. Selden was an early case that helped mold copyright law by providing a clear difference between copyright material and patentable material.
The case between A&M Records (along with more than a dozen other record companies) vs. Napster was the first time file sharing was examined under U.S. copyright law. It asked the question: is a company responsible for the illegal actions of other people if their program gives users the tools to perform such illegal activities?
Napster was a program that allows users to share music files in the form of MP3s, a music format relatively new at the time, which compressed music into a small size without a substantial drop in audio quality. As MP3 awareness and popularity rose steadily, so did Napster, a tool that gave users the ability to perform illegal file swapping, but at the same time, could be used legally as well. 
This was Napster’s main argument, believing that it is not responsible for how its program is used by its customers. This case was the beginning of a long copyright battle in the record industry, fronted by the Recording Industry Association of America, which is still going on today.
Rogers v. Koons: This case showed that in order for a parody to be legal, it must be a commentary on the original artwork itself and cannot be a reproduction with another message entirely.
One of the earliest and most famous copyright disputes occurred in the case of Baker v. Selden. This case helped to clearly outline what material is protected under copyright law. Although the work that Baker created was similar to Selden’s original work, it was decided that Baker had not violated copyright law. 
This is because copyrights only protect expressions of ideas, while the ideas themselves are only protected when one obtains a patent. This distinction was incorporated into the U.S. Copyright Act, which was inspired by the Baker v. Selden case.
MGM Studios, Inc. v. Grokster, Ltd. was a copyright infringement case that held remarkable similarities to the famous Sony Corp. v. Universal City Studios case, which ruled that the makers of VCR technology cannot be held liable for any illegal copying done by its users. In the same sense, Grokster was argued to be held liable for file sharing technology which users can take advantage of to download copyrighted material such as music and movies.
Grokster had already won two prior victories in court, the latest in the United States District Court for the Central District of California in 2003, where the Sony v. Universal case was cited in the decision. Ultimately, the decision found that Grokster should be held liable for copyright infringement which takes place using the technology it has available on the Internet. 
There was argument, however, about how similar this case was with the Sony v. Universal case. It was found that the case had no influence on the court’s final decision. This case led to other peer-to-peer file sharing networks to close down in fear of a lawsuit, while others took more substantial measures to ensure that its users do not use their program for copyright infringement.

IO Group v. Veoh Networks

IO Group v. Veoh Networks

IO Group, Inc. v. Veoh Networks, Inc. (586 F. Supp. 2d 1132) was a legal case that took place in the United States District Court for the Northern District of California involving Veoh, a company that offers its users internet television for free, and IO Group, producer of adult entertainment. The U.S. District Court ruled in favor of Veoh Networks because the company was protected under the guidelines of the Digital Millennium Copyright Act (DMCA) in 17 U.S.C. § 512. This copyright infringement case is similar to the famous Viacom vs. Youtube, Google Inc. case.
Like YouTube, Veoh offers a service allowing anyone of its users to upload videos to the website. Veoh understands that users may take advantage of the service to upload content that has been copyrighted, so they established a firm Terms of Use with the intent of protecting itself and its users from legal trouble. 
The Terms of Use explained that users are responsible for the content in which they upload and Veoh does not permit copyright infringement of any kind. 
They also stated that any account which uploads copyrighted material may be subject to termination through Veoh’s discretion. Veoh’s strict policies are enforced through a system of account termination when an infringing work is uploaded to their servers. If this happens, a user’s account is terminated and their e-mail address is blocked so a new Veoh account cannot be created by that user.
The copyright infringement case emerged in a lawsuit filed by IO Group on June 23, 2006, after it noticed that several of its copyrighted work was available on Veoh’s website. Instead of sending a cease and desist letter, IO Group filed the lawsuit as the first step. The lawsuit claimed Copyright Infringement, Contributory Copyright Infringement, and Vicarious Copyright Infringement. Following the legal action, Veoh had decided not to include adult content on its website.
Under the DMCA, to be within the legal “Safe Harbors” Veoh and other similar companies must meet the following guidelines:
*The company must offer a service provider.
*It must create and enforce a policy which terminates the accounts of repeated infringers and blocks them from future access.
*It must accommodate technical measures that copyright owners have set in place to protect their work.
IO Group did not argue in court that Veoh failed to comply with the above guidelines. Instead, IO chose to accuse Veoh of having an infringement policy which was effective in preventing copyrighted material from being made available online illegally. Veoh, however, was able to prove that they had an adequate system to notify users of infringement policies, as well as establishing a proper system of digital fingerprinting of files. They also responded to all copyright notices they received by taking down the violating videos immediately and the Court agreed that copyright infringement protocol was handled correctly.
IO Group was still not convinced and claimed that Veoh should be required to take further action against repeated infringers by not only blocking e-mail addresses, but names and IP addresses as well. This would prevent users from signing up with different e-mail accounts. The Court disagreed and noted that Veoh did procedures under the guidelines of the DMCA, which does not require a policy system to be perfect, but rather “reasonable”.
Veoh was also proven to pass the “Red Flag Test”, a test that states that if a company does not take action against infringement while having knowledge of it, they should have their “Safe Harbor” status repealed. In addition, many of the video clips claimed by IO Group did not have proper copyright notices on them. The copyright infringement case ended up with a grant of Veoh’s motion for a summary judgment and it was dismissed.

Irving Berlin v. E.C. Publications, Inc.

Irving Berlin v. E.C. Publications, Inc.

Irving
Berlin v. E.C. Publications, Inc. (329 F. 2d 541), which took place in 1964,
was one of the many
 copyright infringement cases which helped shaped
copyright law and parody copyright guidelines. The court case involved Irving
Berlin’s song entitled “A Pretty Girl is Like a Melody”, in which Mad
Magazine, a popular parody magazine, parodied the song and entitled it
“Louella Schwartz Describes Her Malady”. E.C. Publications, Inc., Mad
Magazine’s parent company, was named the defendant in the case.

Mad Magazine, known for its humorous depictions of
pop culture, published a volume called
 The Worst from Mad No. 4. In it, Mad Magazine had a
feature called “Sing Along with Mad” in which they parodied songs and
printed replacement lyrics to artists’ songs. During the trial, Judge Irving
Kaufman famously stated that, “We doubt that even so eminent a composer as
plaintiff Irving Berlin should be permitted to claim a property interest in
iambic pentameter.” The judge was referring to meters used to establish
the rhythm in which words are arranged on each line of poetry.

The court ruled that the parody song of Irving Berlin’s
work featured in Mad Magazine did not violate parody copyright laws. All other
songs except for two were ruled out at the conclusion of the case. It was found
that two of Mad Magazine’s parodies were too similar to the original songs,
which used the same verbal hooks as the original. Berlin and other music
publishers involved in the case appealed to the U.S. Court of Appeals, though
they refused to withdraw the victory Mad Magazine had in court.

Of all copyright infringement cases, this one is important to
parody copyright law
because it paved the way for parodists to use similar
meter structure of popular songs, a right that is still stands today.

MGM Studios, Inc. v. Grokster, Ltd.

MGM Studios, Inc. v. Grokster, Ltd.

The
copyright infringement case of MGM Studios, Inc. v. Grokster, Ltd. was filed in
2003 by MGM, Metro-Goldwyn-Mayer, Inc., a total of 28 other entertainment
companies, against Grokster and Steamcast.  Grokster and Steamcast were
Internet companies that offered peer-to-peer file sharing.  Peer-to-peer
file sharing, otherwise known as P2P file sharing, is the act of sharing stored
digital information, such as movies, music, documents, and electronic
books.  This particular movie copyright suit was filed due to the fact
that a large number of the files that were being shared on these websites were
copyrighted material, some of which belonged to MGM and the other listed
entertainment companies.

In response to the copyright infringement case,
Grokster argued that if the movie copyright suit were to be found in favor of
the plaintiff, this would create the potential grounds for movie copyright
organizations to seek damages in a number of previous acts believed to be
related to peer-to-peer file sharing and copyright infringement.  With
this not being the first filed copyright infringement case that Grokster was
named in on behalf of MGM, there was a great deal at stake as to what the final
decision would forecast for future movie copyright regulations. 

The
copyright infringement case was originally filed by MGM, along with the 28
entertainment companies, in the United States District Court for the Central
District of California.  The copyright infringement case was dismissed in
2003, due to its parallels to the Sony Corp. v. Universal City Studios movie copyright
case, and its final verdict.  In the Sony Corp v. Universal City Studios
copyright infringement case, the court had to reach a decision as to the
regulation of the VCR. 

Movie
copyright lawmakers had to decide whether or not VCR manufacturers would be responsible
for the actions of consumers that used their product on the basis of potential
copyright infringement.  In the copyright infringement case of Sony Corp.
v. Universal City Studios, the final verdict by the Supreme Court of the United
States concluded that the function of VCR recording for individual use executed
a person’s right to fair use.

The copyright infringement case of MGM Studios,
Inc. v. Grokster, Ltd., was then filed by MGM to the United States Court of
Appeals for the Ninth Circuit.  This second installment of the movie
copyright case was dismissed on the basis of the notion that P2P file sharing
is a method that is lawfully binding.  Nevertheless, it was in 2005 that
the United States Supreme Court made the final ruling on the copyright infringement
case, declaring that Grokster, Ltd. and Steamcast were liable for their
involvement in the P2P file sharing being conducted on their networking
sites. 

The basis
for the final Supreme Court ruling in the MGM Studios, Inc. v. Grokster, Ltd.
copyright infringement case was that the court saw the defendants’ actions as a
copyright infringement by specifically promoting such practice and capability
to consumers.

Pirate Bay vs. Sweden

Pirate Bay vs. Sweden

The Pirate
Bay is a website based in Sweden, functioning as a
 BitTorrent indexer and tracker, claiming
to be the largest website in the world dedicated to BitTorrents. BitTorrents
have raised many concerns about copyright infringement
, as many users have taken advantage of the technology to
download copyrighted music, movies and other works within a matter of minutes
and free of charge. As a result, media companies owning popular copyrights
 have taken action against The
Pirate Bay and other similar BitTorrent websites. Websites such as The Pirate
Bay have also inspired new internet copyright law to be set into place to
combat copyright infringement.


Police Raid on the Pirate Bay

The Pirate Bay was the primary target in the fight
against BitTorrent trackers. On May 31, 2006, The Pirate Bay was raided by
Swedish police in twelve different premises and resulted in the seizing of 186
servers. The Pirate Bay was subsequently offline for the following three days.

According to
the founders of The Pirate Bay, they believe that the raid was political and
was the result of pressure from the Motion Picture Association of America
(MPAA). The effects of the raid were in favor of The Pirate Bay. However, the
website was back online days later and BitTorrent downloads through their
tracker doubled.

Following the investigation of the confiscated
servers and hard drives and interrogations by the Swedish police, a four
thousand page report was written by the prosecutor to precede an oncoming
trial. E-mail messages, SMS messages, financial records, police interrogations,
and pictures of The Pirate Bay’s website were included within the report.

The Pirate Bay Trial

The trial of The Pirate Bay vs. Sweden is one of
many high profile copyright cases and is followed closely by the internet
community, especially people who use BitTorrents. On January 31, 2008, Swedish
prosecutors filed charges against four individuals they believed were closely
associated with The Pirate Bay, a company that promoted the use of illegal
copyright infringement under internet copyright law. These individuals included
Gottfrid Svartholm, Fredrik Neij, and Peter Sunde, the current caretakers of
the website. The evidence which was to be used in the trial originated from the
raid which took place almost two years before. The trial finally began on
February 16, 2009.

On the first day of the trial, defense lawyer, Per E. Samuelson,
stressed that file sharing protocols
such as BitTorrent can be used for either legal or illegal
purposes, further stating that a tool which can be used for legal and illegal
practices does not violate Swedish law. He also claimed that the users
themselves are the ones that should answer for the material which they obtained
illegally.

During the second day of the trial, the charges against The Pirate
Bay were partially dropped. Although the defense attorneys claimed it to be a
victory, the prosecutors thought that the dropped charges do not change the
main case and will allow the prosecutors to focus on the primary issue at hand.
The dropped charges were largely related to “assisting copyright infringement”,
though these charges were expected to be dropped because The Pirate Bay is not
responsible directly for distributing illegal copies of media.

As the trial continued, prosecutors claimed that
the owners of The Pirate Bay should have obtained licenses for content it helps
distribute. As a defense, Samuelson claimed that to assist in a crime that
violates internet copyright law, one would have to have close ties with the
perpetrators. Since the users of The Pirate Bay distribute files anonymously under
website usernames, they are not closely tied to them and should not be held
accountable.

For the remainder of the trial, the prosecutors
portrayed The Pirate Bay as a profitable business, creating revenue through
assisting in the violation of internet copyright law. The defense portrayed The
Pirate Bay as nothing more than an ordinary search engine an internet user
would typically access to retrieve information. Also, expert witnesses were
brought in by the prosecutors and defense, both giving contradicting views on
the effects of internet copyright infringement on media sales and profits.

The Verdict

At the conclusion of the trial, The Pirate Bay
employees were sentenced to one year in jail and a payment of damages amounting
to $3.5 million U.S. dollars. The court concluded that the defendants were
guilty of being an accessory to a crime which violated internet copyright law.
The court found that a person may be an accessory to a crime without directly
committing a crime. An ongoing appeal to the verdict is ongoing as of April 29,
2010.

A & M Records vs. Napster

A & M Records vs. Napster

A & M Records vs. Napster was a major
intellectual property case that took place in 2001, pertaining to the illegal
file sharing of MP3 music files, which the record industry claimed
was copyright infringement. The United States Court of
Appeals for the Ninth Circuit affirmed the decision of the United States
District Court, for which the Northern District of California held the
defendant, Napster, may be liable for contributory infringement and vicarious
infringement of copyrights held by companies within the music industry.
 


This case was responsible for bringing
peer-to-peer file sharing services into public attention, which could
potentially be used to illegally share copyrighted material, and was the first
of several other similar cases.

The Plaintiffs

Although the case is referred to as “A & M Records v. Napster”,
the list of plaintiffs extends beyond just A & M Records. There were a
total of eighteen plaintiffs listed against Napster in the District Court suit,
all subsidiaries of the “big four” record companies: Universal Music Group, Sony Music Group, Warner Music
Group, and EMI. All four companies are members of the Recording Industry
Association of America (RIAA), a group formed in 1952 which represents the
recording industry distributors within the United States, making up more than
80 percent of all music officially released in the U.S.

Defendant

Napster was a company formed by eighteen year old Shawn Fanning at Northeastern
University. Napster was the first user-friendly peer-to-peer file sharing
service, which allowed any user to access other users’ MP3 files, which were
easily downloaded. Napster also introduced a simple searching ability from
their central server, allowing users to quickly access a list of available
files for which they would be searching. Napster
quickly rose in popularity to its peak in 2001, as millions of users continued
downloading song files for free from other computers around the world.

District Court

The record companies involved in the case filed to place a preliminary injunction
to cease the exchange of files, which they claimed violated music copyright law. They also sought claims against
Napster for contributory and vicarious copyright infringement. To counter this
argument Napster defended itself through fair use and substantial
non-infringing use, also claiming that the injunction requested by the record
companies violated their First Amendment right to free speech.
 


Judge Marilyn Hall Patel ruled that the
record companies had a valid argument against Napster and had successfully
proved irreparable harm to the record industry through music copyright
infringement. The injunction against Napster was granted and the judge ordered
a plan of action to be taken by Napster to remove files protected under music
copyright from their network. Napster immediately appealed to the decision to
the United States Court of Appeals for the Ninth Circuit.

The Appeal

Napster actively countered the injunction decision through an argument. The court, however,
decided that even though Napster did not directly profit off of the material
that was distributed over their networks, the excessive copying of works
constituted music copyright infringement. The Ninth Circuit consequently agreed
with the District Court’s conclusion that Napster jeopardized the record
industry’s sales.

Napster identified three points of fair use in which its service properly used
copyrighted material:

1. Napster claimed that the network could be used to
“sample” MP3 music files for a user to make a decision of whether or
not to purchase the record.

2. “Space-shifting” was also claimed by Napster, a
concept in which a user who already owns a legal copy of the music may legally
download the MP3 file through Napster’s network. This argument was proven
invalid because when a user downloads a file in Napster, it is immediately made
available to other users.

3. Napster also identified permissive distribution in its
fair use arguments, in which an artist can give permission for distribution of
copyrighted music through Napster’s system. The court allowed this practice to
continue.


The court also found that since Napster had the ability to regulate what its
users distribute over its networks, they had a responsibility to prevent music
copyright infringement from taking place.

Contributory Infringement

Napster argued in the Ninth Circuit Court that they had no way to distinguish a
copyrighted music file and a file that was not copyrighted, so they should not
be held liable for infringement. The court disagreed, however, and Napster was
found to be held
directly support
ing the infringement of music copyright
material.

Vicarious Infringement

The Ninth Circuit Court sided with the District Court, agreeing that Napster’s
primary draw to users was the ability to illegally obtain copyrighted work.
Also, since Napster planned to expand and increase the number of its users in
the future, their activities were ruled to be inductive to financial gain from
illegal infringement.

Aftermath

Napster struggled with the injunction demands and when they were only able to
maintain a 99.4 percent efficacy in removing music copyright work, the judge
ordered Napster to be shut down until it reached 100 percent. Napster soon
filed for Chapter 11 bankruptcy and was forced to shut down after Bertelsmann’s
inquisition to purchase Napster was blocked by the court.

The record industry’s case against Napster had a large impact on copyright
infringement of music and other files on the internet. Other peer-to-peer
networks emerged in the wake of Napster’s demise, though
they were also subject to the same legal trouble.