Advanced Copyright Issues on the Internet - Fenwick & West LLP

generalized knowledge that the Napster system might be used for infringing transmissions wasnot sufficient for contributory liability, and that in every instance in which Napster receivedactual knowledge from the plaintiffs of infringing acts by a specific user, Napster had acted toterminate such infringing activity. The district court rejected this argument, ruling that actualknowledge of specific acts of infringement is not required for contributory liability, citingGershwin Publ’g Corp. v. Columbia Artists Management, Inc., 1227 which the court characterizedas holding that general knowledge that third parties performed copyrighted works satisfied theknowledge element of contributory infringement. Accordingly, “the court rejects defendant’sargument that titles in the Napster directory cannot be used to distinguish infringing fromnoninfringing files and thus that defendant cannot know about infringement by any particularuser of any particular musical recording or composition.” 1228The district court also rejected Napster’s reliance on the following passage from theNetcom decision concerning contributory liability of service providers:Where a BBS [bulletin board service] operator cannot reasonably verify a claimof infringement, either because of a possible fair use defense, the lack ofcopyright notices on the copies, or the copyright holder’s failure to provide thenecessary documentation to show that there is likely infringement, the operator’slack of knowledge will be found reasonable and there will be no liability forcontributory infringement for allowing the continued distribution of the works onits system. 1229The district court held that this language was dicta because the plaintiffs in that caseraised a genuine issue of material fact regarding knowledge. But more importantly, the courtruled that Napster “is not an Internet service provider that acts as a mere conduit for the transferof files.” 1230One of the important issues on appeal was whether constructive knowledge is sufficientfor contributory liability, or whether actual knowledge of infringing uses is required for liability.The Ninth Circuit in Napster I began its analysis of the knowledge prong by stating thatcontributory liability “requires that the secondary infringer ‘know or have reason to know’ ofdirect infringement.” 1231 The Ninth Circuit also stated, “It is apparent from the record thatnotice or watermark. MP3 file names are created by users, contain errors, and are variable and undependable.Finally, Napster argued that song titles could not be used to distinguish authorized files from others becausemany song titles are used by multiple artists or there may be multiple recordings of the same work – some ofwhich are authorized to be shared and others not. Napster’s PI Opp. Br., supra note 1173, at 18-19.1227 443 F.2d 1159, 1163 (2d Cir. 1971).1228 Napster, 114 F. Supp. 2d at 918.1229 Religious Technology Center v. Netcom Online Communication Services, Inc., 907 F. Supp. 1361, 1374 (N.D.Cal. 1995).1230 Napster, 114 F. Supp. 2d at 919.1231 Napster I, 239 F.3d at 1020 (citing Cable/Home Communication Corp. v. Network Prods., Inc., 902 F.2d 829,845 & 846 n.29 (11th Cir. 1990).- 279 -