The music industry's success in getting a federal court to shut down LimeWire's peer-to-peer (P2P) file-sharing network on Tuesday shows just how effectively secondary liability laws can be used to enforce copyright protections, say legal experts.
What happened in the LimeWire case is similar to the outcome in the 2005 dispute between MGM and P2P software maker Grokster . In that case, the Supreme Court held that vendors who develop and actively promote technologies with the object of enabling copyright infringement can be held liable for infringement committed by their users.
That the court in the LimeWire case came to the same conclusion shows "secondary liability is a very powerful tool for copyright enforcement," said David Sohn, a senior policy director at Center for Democracy and Technology.
"The decision, in most respects, basically follows the blueprint in the Grokster case regarding inducement to infringe," Sohn said. "What this case and Grokster shows is that if you are taking steps to actively recruit people who want to infringe, then you don't have clean hands and that indeed you can get shut down."
LimeWire, one of the largest distributors of P2P software with an estimated 8 million users in the U.S., was ordered by a New York federal court on Tuesday to immediately stop distributing and supporting its software.
The company has been given 14 days to report back to the court on the measures it has taken to disable its software and to inform users and its employees of the injunction.
The court order was not entirely surprising considering that the same court had in May already found LimeWire liable for contributing to massive copyright infringement.
The court was responding to lawsuits filed by several recording labels and music publishers that accused LimeWire and its chief executive, Mark Gorton, of not only enabling mass piracy but also actively inducing it.
The music industry claimed that LimeWire's software had been used by individuals around the world to illegally copy and distribute "billions and billions" of copyrighted songs.
Federal Judge Kimba Wood of the U.S. District Court for the Southern District of New York, where the case was filed, determined that LimeWire had failed to implement any meaningful barriers that would have made it harder for users of its software to illegally share and download music files.
Thomas Sydnor, director of the Center for the Study of Digital Property at The Progress & Freedom Foundation, said that the case is a classic example of what can happen if courts determine that technology vendors are actively inducing others to infringe copyright.
In this case, LimeWire and several supporters, including organizations such as the Electronic Frontier Foundation, the Center for Democracy and Technology, the Information Technology Association of American and others, had argued that technology vendors should not be held liable if users misuse their technology.
In an Amicus brief (PDF document) filed in support of LimeWire in 2008, several of the organizations argued against the notion of applying secondary liability doctrines in this case., arguing that multi-use technologies such as LimeWire's allowed for both legitimate and illegal uses.
"When a copyright owner urges a court to find a technology vendor liable for distributing a multi-use technology capable of both infringing and noninfringing uses, the dispute inevitable implicates innovation policy more broadly," the groups argued in their brief.
However, Sydnor said the mere fact that a vendor's technology is multi-use and can be used for non-infringing purposes does not by itself absolve the vendor of liability for its user's actions.
If the technology is used largely for copyright infringement purposes and if the company actively promoted that activity, then it can indeed be found liable as happened in the LimeWire case, Sydnor said.
"Just because your software can be used for dual purposes doesn't mean you can deliberately set out to build a business based on copyright infringement," as happened in LimeWire's case, he said.