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Hold technology creators liable?

The entertainment industry wants the courts to make technology creators liable for their inventions, but CNET News.com's Declan McCullagh explains why anyone of sane mind will have a difficult time deciding where to draw the line.

WASHINGTON--Should the people who invent technology be legally responsible for what other people do with it?

The Recording Industry Association of America thinks so. It recently sued four college students for running programs that create a searchable index of files on a local area network. Their offense: The utilities, which go by names like Phynd and FlatLan, are general-purpose tools that indiscriminately compile lists of copyrighted and noncopyrighted files that can be transferred from one machine to another.

The results of the RIAA's action were predictable. Faced with the unpalatable prospect of spending hundreds of thousands of dollars in attorneys' fees defending themselves, the students quickly chose the lesser of two evils, handing over $12,000 and $17,000 each to the RIAA to settle the case.

The RIAA didn't do nearly as well in another lawsuit that, by contrast, benefited from an aggressive team of defense attorneys. U.S. District Judge Stephen Wilson recently ruled that peer-to-peer services Grokster and Streamcast Networks, which distributes Morpheus, were not liable for what their users did. "Defendants distribute and support software, the users of which can and do choose to employ it for both lawful and unlawful ends," Wilson wrote in a 34-page opinion.

"Grokster and Streamcast are not significantly different from companies that sell home video recorders or copy machines, both of which can be and are used to infringe copyrights," Wilson wrote. Even if the companies vanished overnight, the peer-to-peer networks would continue to operate, he noted.

That's exactly right, and it's heartening to see that at least one federal judge is tech-savvy enough to get it. Wilson rejected the arguments from the RIAA and its fellow Hollywood plaintiffs that wanted to establish the legal principle that creators of general-purpose technology can be sued if it can also be used for illicit purposes.

This isn't the first time the entertainment industry has tried to make inventors responsible for what people do with their creations. The most obvious example is the 1984 case of Sony v. Universal City Studios, in which the Supreme Court rejected an attempt to restrict the then-novel VCR after concluding it was quite "capable of substantial noninfringing uses." (In a bit of historical irony, Sony Music Entertainment is one of the plaintiffs in the current lawsuit against the P2P services. And John Ashcroft, then-attorney general of Missouri, filed a brief siding with Hollywood against those nettlesome VCRs.)

If technology inventors are held liable, it's difficult to imagine where to draw the line. The Google search engine arguably helps pirates find copies of software, and Usenet newsreaders--from Forte FreeAgent to the venerable tin and trn--surely aid and abet file-swapping on the alt.binaries hierarchy. FTP (file transfer protocol) is often used to swap illicit files, the argument might go, and the ready availability of free Perl interpreters and C compilers accelerates the development process.

Right?

This isn't the first time the entertainment industry has tried to make inventors responsible for what people do with their creations.
I'm exaggerating to make a point, but perhaps not by much. Eight movie studios handily won a lawsuit against the DeCSS DVD-decryption utility, even though it had substantial noninfringing uses -- something the Supreme Court said was acceptable in the Sony case. The reason for the 2nd Circuit's decision: The 1998 Digital Millennium Copyright Act, which, by declaring circumvention tools to be verboten, nixed part of the Sony decision's effect.

Similarly, Rep. Bob Goodlatte, R-Va., introduced a bill during the last session of Congress that would make it illegal to distribute software that could be used to spam. His "Anti-Spamming Act" bans code that "has only limited commercially significant purpose or use other than to conceal such source or routing information" used in e-mail addresses. That would cover some spamware, true, but it could ban legitimate utilities as well. (And this is from the person who is co-chairman of the Congressional Internet Caucus.)

Then there were the encryption wars that took place through much of the 1990s, when the U.S. government tried to restrict data-scrambling software like Pretty Good Privacy just because criminals might use it to cloak their communications. The sentiment is still strong among hawks in Congress. In a floor speech two days after Sept. 11, 2001, Sen. Judd Gregg, R-N.H., called for a global prohibition on encryption products without backdoors for government surveillance.

All of these legal tactics have something in common: They seek to punish people who write code instead of the people who do mischief with it. After all, software creators and distributors are more visible and easy to target through the court system than people who stealthily use SSH or DeCSS at home and choose not to inform law enforcement about it. Instead of punishing only miscreants and spammers, the rule covers everyone.

While the RIAA's legal arguments are dangerous, I do think the group makes a reasonable economic point. Today's in CD sales may not be due to P2P networks in the short term, but in the long term, piracy will become a more attractive option. As bandwidth becomes more plentiful, song quality improves and storage space becomes cheaper, the music industry faces a critical problem. And this means that if the record labels lose in court, they won't give up.

Pay attention to the endgame. In the 1994 U.S. v. LaMacchia prosecution, a judge dismissed charges against a 21-year-old MIT student who ran a pirate Internet site, saying that it was not a criminal offense to do so under current federal law. Criminal penalties "should probably attach to willful, multiple infringements of copyrighted software, even absent a commercial motive on the part of the infringer," Judge Richard Stearns wrote. Stearns suggested that Congress step in.

Congress obliged. Three years later, President Clinton signed into law the No Electronic Theft Act, which makes--as I've written about before--copyright infringement a federal crime even if not done for commercial purposes.

Watch for the same thing to happen here. In a little-noticed part of his decision a few weeks ago, Judge Wilson said current copyright law does not prohibit the creation of P2P networks--and then suggested that Congress might want to rewrite the law. "Additional legislative guidance may be well-counseled," Wilson said.

For now, at least, the RIAA will appeal its loss in the Grokster and Morpheus cases to the 9th Circuit. If the appeals courts uphold the lower court's ruling and nothing else changes, the RIAA will immediately ask Congress for a law against P2P networks, which is where the real endgame would take place. (Bolstering the RIAA's position is a January ruling from the Supreme Court in the Copyright Term Extension Act case, in which the majority decided: "We are not at liberty to second-guess congressional determinations and policy judgments...")

Don't believe me? RIAA spokesman Jonathan Lamy told me on Friday: "It's far too early to discuss any particular legislative strategies. We will evaluate the situation after a decision from the appeals court."