![]() However, Streamcast's software allowed users to search for "Top 40" songs, which were almost always copyrighted. Slip op. The Grokster and Streamcast software does not tell the companies when particular files are copied. Slip op. MGM also placed the companies on notice that 8 million copyrighted files could be obtained using their software. Slip op. Importantly, Grokster and Streamcast conceded direct infringement by users of their software, and that they were aware that users use their software primarily to download copyrighted files. The companies also learned from time to time of their users' infringement directly from the users, when users sent emails to each company with questions about playing copyrighted movies they had downloaded. The companies responded to such inquiries with guidance. MGM commissioned a study that showed nearly 90% of the files available for download were copyrighted works. Slip op. at 1. The peer-to-peer networks created by the software can be used to share any type of digital file, but the networks are primarily used to share copyrighted music and video files without the authorization of the copyright owners. Slip op. There is no central server and Grokster and Streamcast are not involved in users' acts of file sharing. Slip op. Grokster and Streamcast distribute free software that allows computer users to share electronic files through peer-to-peer networks. The software allows users' computers to communicate directly with each other. ![]() Id. Because Grokster's and Streamcast's unlawful objective is unmistakable, the Court was effectively ruling that there are no genuine disputed issues of fact material to MGM's motion for summary judgment, and therefore MGM's motion, which seeks a judgment holding Grokster and Streamcast liable for copyright infringement, is likely to be granted. This will allow MGM to proceed on its claims for damages and injunctive relief. Slip op. at 24, the Court stated that MGM's motion for summary judgment should be considered by the district court when the case is remanded. at 23, and that "here is substantial evidence in MGM's favor on all elements of inducement," Slip op. Because the Supreme Court concluded that Grokster's and Streamcast's "unlawful objective is unmistakable," Slip op. at 24. Ordinarily, such a holding would lead to a trial on the plaintiffs' (referred to herein as "MGM") copyright infringement claims, but MGM had also filed a motion for summary judgment. at 16-17, 23. The Supreme Court remanded the case to the district court. Slip op. at 24.Īccordingly, the Court concluded that the district court should not have granted summary judgment in favor of Grokster and Streamcast, and that the Ninth Circuit Court of Appeals should not have affirmed the district court. Slip op. at 1 and 19. Here, evidence of Grokster's and Streamcast's "words and deeds going beyond distribution as such shows a purpose to cause and profit from third-party acts of copyright infringement." Slip op. The decision of the Court was unanimous and was written by Justice Souter. The issue decided by the Court was as follows: Under what circumstances can the distributor of a product capable of both lawful and unlawful uses be liable for acts of copyright infringement by third parties using the product? Applying a theory of inducement of copyright infringement, the Court held that anyone who distributes a device with the intent of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for third party infringement. Slip op. ![]() Supreme Court's Jdecision in Metro-Goldwyn-Mayer Studios Inc.
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