Advanced Copyright Issues on the Internet - Fenwick & West LLP

Turning to the material contribution prong, the court ruled that neither StreamCast norGrokster had materially contributed to the infringing acts of users of their software. The courtfirst noted that the Ninth Circuit found liability in the Napster case because Napster did morethan distribute client software – it also hosted a central list of files available on each user’scomputer and “thus served as the axis of the file-sharing network’s wheel.” 1397 Here, “thecritical question is whether Grokster and StreamCast do anything, aside from distributingsoftware, to actively facilitate – or whether they could do anything to stop – their users’infringing activity.” 1398With respect to Grokster, the court noted that Grokster did not have access to the sourcecode of the FastTrack client software application, and its primary ability to affect its users’experience was the ability to configure a “start page” in the software and to provide advertisingautomatically retrieved by the software. An individual node using the FastTrack softwareautomatically self-selected its own supernode status, and utilized a preset list of “rootsupernodes,” each of which functioned principally to connect users to the network by directingthem to active supernodes. 1399 “While Grokster may briefly have had some control over a rootsupernode, Plaintiffs do not dispute that Grokster no longer operates such a supernode. Thus, thetechnical process of locating and connecting to a supernode – and the FastTrack network –currently occurs essentially independently of Defendant Grokster.” 1400 The transfer of filesamong users was accomplished without any information being transmitted to or through anycomputers owned or controlled by Grokster. 1401With respect to StreamCast, the court noted that the Gnutella technology on whichStreamCast was based was a “true” peer-to-peer network that was even more decentralized thanFastTrack. Users connected to the Gnutella network by contacting another user who was alreadyconnected. The initial connection was usually performed automatically after the user’s computercontacted one of many publicly available directories of those currently connected to the Gnutellanetwork. Instead of using supernodes, search requests on the Gnutella network were passedfrom user to user until a match was found or the search request expired. 1402Accordingly, the court concluded that, unlike Napster, neither StreamCast nor Groksterprovided the “site and facilities” for direct infringement. Users connected to their respectivenetworks, selected files to share, sent searches, and downloaded files, all without materialinvolvement of the defendants. 1403 “If either Defendant closed their doors and deactivated allcomputers within their control, users of their products could continue sharing files with little or1397 Id. at 1039.1398 Id.1399 Id. at 1040.1400 Id.. Primary root supernodes on the FastTrack network were operated by Kazaa BV and Sharman Networks.Id. at 1040 n.6.1401 Id. at 1040.1402 Id. at 1041.1403 Id.- 311 -