Court again rules against Morpheus
p2pnet news | P2P:- Not all that long ago, you’d have seen Morpheus, Warez, BearShare, LimeWire and Blubster p2pnet advertisements.
They were all legally founded, independent American companies, but they were all offering P2P file sharing applications in the face of opposition from the Big 4 organised music cartel, which is determined to gain complete and total control of how, and by whom, music product is distributed online.
Now only Blubster, based in Spain, remains.
That’s because the Big 4, Vivendi Universal (France), Sony BMG (Japan and Germany) and EMI (Britain), with Warner Music as the only US company, have been able to use the American legal system to effectively shut down what could have been the competition.
Grokster was another independent P2P company and, with StreamCast Networks’ Morpheus and Sharman Networks’ Kazaa, it became the focus of what eventually rang as the final death knell for the above-mentioned independent concerns.
Grokster is long gone and on Grokster.com you now see:
The United States Supreme Court unanimously confirmed that using this service to trade copyrighted material is illegal. Copying copyrighted motion picture and music files using unauthorized peer-to-peer services is illegal and is prosecuted by copyright owners.
There are legal services for downloading music and movies.
This service is not one of them.
YOUR IP ADDRESS IS xx.xx.xx.xxx AND HAS BEEN LOGGED.
Don’t think you can’t get caught. You are not anonymous.
Actually, that categoric statement is nowhere near as categoric as it makes itself out to be. But that’s another story.
Meanwhile, at a cost of well over $100 million, Sharman Networks now operates on the same side of the fence as the cartels – a position it worked hard to attain, all the while pretending it was solidly behind the P2P community – and is an important part of their ongoing plan to control online music.
This left Morpheus as the only US survivor.
A couple of days ago, we received an interesting document. 
Signed by US district judge Stephen V. Wilson, at its conclusion, it states:
… this Court GRANTS IN PART Plaintiffs’ motion for a permanent injunction. Importantly, StreamCast will be required to use the most effective means available to reduce the infringing capabilities of the Morpheus system and software, while preserving its non-infringing uses as feasible. StreamCast’s motion for a state of permanent injunction pending appeal is DENIED WITHOUT PREJUDICE.
Is that the end for Morpheus? Because what it all boils down to is:
StreamCast has been ordered to virtually halt all activities, including advertising, until it’s been able to implement a DRM system which guarantees copyrighted corporate product won’t be infringed by application users.
Says the EFF’s (Electronic Frontier Foundation) Jason Schultz on his LawGeek blog:
Part two of the trial court’s permanent injunction decision in MGM v. Grokster deals with the proper role and scope of the injunction in the case of a defendant that induces others to infringe copyrights. (see here for Part 1 of my analysis re: presumptions and proof of irreparable harm).
The court starts out with a fairly innocuous statement: “The scope of the injunction should be coterminous with the infringement.” Fair enough. But as the court then makes clear, what that scope is exactly is hard to define. Inducement of copyright infringement in the P2P content is a funny beast. As the court recognizes, it is a combination of both behavior (promotion/encouragement of illegal acts) as well as the provision or distribution of technology. When that technology has legitimate non-infringing uses, an injunction banning that technology completely is beyond the scope of the infringement and not coterminous.
So what’s a court to do? Well, instead of simply mandating that StreamCast stop all infringement, it sorts through the various options and settles on filtering. While the court justifies filtering on the premise that it is an option that will not shut down the Morpheus system (an overboard approach) but still addresses the issue of infringement, I also think the court found it to be the most flexible option, leaving it with a feeling that it could easily revisit the issue by raising or lowering the sensitivity and burden of the filtering requirements as needed.
In discussing the scope of the filter, the court quickly dismisses any requirement that it be “perfect” as that would effectively shut down StreamCast and ban distribution of the Morpheus software. Instead, the court required StreamCast “to reduce Morpheus’s infringing capabilities, while preserving its core noninfringing functionality, as effectively as possible.” This boils down to two things:
1. Installing a filter as part of future Morpheus software distributed to the public; and
2. Taking steps to encourage legacy users of the old Morpheus software to upgrade to the new filtered versions.
Of course, phrases like “effectively as possible” are bound to be the subject of dispute, but the court did make it clear that it is not expecting StreamCast to go bankrupt trying to filter out every possible work. It also required the Plaintiffs to submit information about each copyrighted work to be filtered so that StreamCast couldn’t be held in contempt for innocently leaving out a song or movie from its list. Finally, the court ordered the appointment of a special master to help evaluate the “highly technical” aspects of StreamCast’s implementation of the filtering program and how effective it should and can be.
One other interesting aspect of the court’s decision was its discussion of whether a company distributing a P2P system found to be inducing infringement could ever be free of its intent to induce. In this decision, the court found that no, it could not. Once an inducer, always an inducer, or as the court said, “The bell simply cannot be unrung.” This means that tech companies must be extremely careful never to be found to be inducing, else they forever bear that mark in litigation.
At the end of his decision, Wilson writes:
A special master will be appointed to assist the Court with further proceedings.
This means, “yet more legal process to choose the special master, wait for the special master’s advice, and then order specific action from StreamCast,” blogs professor Ed Felten on Freedom to Tinker, going on:
“All of this may be proper from a legal standpoint, but it seems unlikely to matter in practice. It’s hard to see how StreamCast can sustain a business given the legal and financial strain they must be under, and the likely ruinous monetary damages they’re still facing.
“I can understand why the plaintiffs might want to keep StreamCast on life support, in the hope of getting legal rulings that prove helpful elsewhere. But why does StreamCast keep fighting?”
Why does it keep on keeping on?
StreamCast told p2pnet it isn’t making any kind of comment at this point.
Definitely stay tuned.
Also See:
LawGeek – Permanent Injunction in MGM v. Grokster, Pt. 2, October 16, 2007
Freedom to Tinker – Grokster Case Lumbers On; Judge To Issue Permanent Injunction, October 17, 2007
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