A federal judge has decided that MP3tunes, a music locker service accused in a lawsuit of enabling mass piracy, has protection under the Digital Millennium Copyright Act. But the judge has also ruled that the company's founder, Michael Robertson, is personally liable for music he uploaded to the service without permission of copyright owners.
In a 29-page decision, U.S. District Judge William Pauley granted the summary motion filed by record company EMI on the two points.
Pauley, from U.S. District Court for the Southern District of New York, ruled that Robertson and MP3tunes.com are liable for contributory infringement for not honoring a request to remove songs from the service that had been identified by EMI as pirated songs. The judge also found Robertson liable for direct infringement for unauthorized music that he personally uploaded.
The most important part of Pauley's decision, however, is his finding that MP3tunes.com is protected by the DMCA's safe-harbor provision. The safe harbor was designed to protect Internet service providers, such as Craigslist, eBay, and Verizon from being held liable for copyright violations committed by users. Robertson has said that should he win on this issue, then iTunes, Google, Amazon, and any other digital-locker service would not have to compensate the record labels for enabling consumers to store their own music in Web lockers.
"It is definitely a victory for cloud music and MP3tunes' business model after a multi-year litigation battle," Robertson said in a statement. "Consumers can have confidence that they'll be able to store, play, and enjoy music using cloud-based services like MP3tunes."
EMI has long argued that Congress never intended to protect companies like MP3tunes, which the record label says operates with a wink and a nod toward piracy. EMI alleges that Robertson created his two operations, MP3tunes.com and Sideload.com, to deliver a one-two punch against copyright. According to EMI, Sideload helps users find and organize links to pilfered music files on the Web. Then MP3tunes is used to store, copy, and retrieve the pirated files via Web-connected devices without paying a dime to the music creators.
"We are pleased that MP3tunes and Michael Robertson have been held liable for infringing hundreds of sound recordings and musical compositions through their Sideload and MP3tunes websites," EMI said in a statement. "The Court's decision confirms that businesses cannot simply pay lip service to the law while undermining the rights of the musicians, artists and writers that create popular music."
EMI attorneys hold that since MP3tunes controlled its servers and monitored songs downloaded by users that the company could prevent copyright-infringing activity. The judge didn't dispute that. Instead, he noted that the DMCA doesn't require service providers to maintain control of their systems. What's important to qualify for DMCA protection is whether a service provider can control infringing behavior.
The judge found that MP3tunes' users alone made the decision to pirate songs, not the company.
"While a reasonable person might conclude after some investigation that the websites used by MP3tunes executives were not authorized to distribute EMI's copyrighted works, the DMCA does not place the burden of investigation on the Internet service provider," he said.
The judge however did put serious requirements on MP3tunes and similar services. Pauley said MP3tues was responsible for removing infringing materials out of people's lockers and if the files stored by numerous people were obtained from the same source, MP3tunes was is responsible for chasing all the copies down and pulling them.
"Because MP3tunes keeps track of the source and web address for each sideloaded song in each user's locker, EMI's notices gave sufficient information for MP3tunes to locate copies of infringing songs in users lockers. All MP3tunes had to do was search for the offending web address in its database of information.
If Robertson is responsible for removing all copies of a particular song every time a content owner sends a takedown notice, it could make it hard to guarantee customers that the music they store in their lockers will be there the next morning.
Robertson and his company could still be required to pay millions in damages for the roughly 500 songs they were found to have infringed. Since the maximum statutory amount for copyright infringement is $150,000 for each instance, then Robertson could be required to pay as much as $75 million.