Advanced Copyright Issues on the Internet - Fenwick & West LLP

make some effort to mitigate abusive use of its technology may still support an inference ofintent to encourage infringement.” 1508The court further noted that StreamCast saw its resistance to filtering as a competitiveadvantage, citing testimony of StreamCast’s chairman that if Napster were forced to filter,StreamCast would take all of Napster’s users. StreamCast was unreceptive when it wasapproached by GraceNote, a company that had worked with Napster on a way to use acousticfingerprinting technology to identify copyrighted music and pay copyright holders. 1509Finally, the court ruled, although not in the context of a DMCA safe harbor defenseasserted by StreamCast, that StreamCast’s blocking of users from its network in response torequests from copyright holders was insufficient to absolve it from liability:This Court recognizes that StreamCast blocked certain users from its networkwhen asked to do so by copyright holders. However, its effort was half-hearted atbest. As described above, StreamCast used encryption technology to defeatPlaintiffs’ monitoring efforts. Moreover, blocking users was not very effectivebecause a user could simply create a new username to re-enter the network undera different identity. StreamCast had the capability of automatically blockingthese users on a rolling basis, but expressly decided not to do so. 1510Based on these factual findings, the court concluded that “evidence of StreamCast’sobjective of promoting infringement is overwhelming” and granted summary judgment ofliability for inducement on the part of StreamCast. 1511(ii)The Permanent InjunctionIn a subsequent opinion, the district court considered the plaintiffs’ proposal for a verybroad permanent injunction against StreamCast. 1512 The court noted that, under the SupremeCourt’s decision in the eBay case, 1513 to be entitled to a permanent injunction on theircopyrights, the plaintiffs were required to satisfy the traditional four part test for injunctive reliefof irreparable harm, inadequate remedies at law, a balance of hardships in their favor, and thatthe public interest would not be disserved by an injunction. 1514 The court first turned to whether,having established infringement, the plaintiffs were entitled to a presumption of irreparableharm, and concluded that a presumption of irreparable harm no longer inures to a plaintiff after1508 Id.1509 Id. at 991.1510 Id. at 992. The court did not elaborate on how StreamCast could have automatically blocked users on a “rollingbasis.”1511 Id. at 992, 999.1512 Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd., 2007 U.S. Dist. LEXIS 79726 (C.D. Cal. Oct. 16, 2007).1513 eBay, Inc. v. MercExchange, L.L.C., 126 S. Ct. 1837 (2006).1514 Grokster, 2007 U.S. Dist. LEXIS at *30.- 333 -