File-sharing 'graveyard' still filling up

LokiTorrent, Scour, SuperNova.org, Aimster and the original Napster were just a few of those sued out of existence, the victims of the entertainment industry's fear of technology, say the companies' supporters. Media execs say justice was done. Those companies profited from illegal file sharing, they say, and enabled others to pick the pockets of actors, musicians and other copyright owners.

Now a new battle is heating up. The search engine TorrentSpy is accused in a lawsuit filed last year by the Motion Picture Association of America (MPAA) of allegedly helping users locate pirated movies online. As the site's parent company, Valence Media, tries to fend off a court order to hand over user information to the MPAA, TorrentSpy's operators say they would likely shut down in the U.S. before complying. In a move that is seen in some corners as a capitulation, TorrentSpy and competitor IsoHunt agreed this week to prevent their search engines from linking to copyrighted material.

Seven years after a judge ordered Napster to halt music swapping, online piracy continues to thrive. Some estimates hold that the large video and music files passing back and forth over the Internet chew up more than a third of the Web's bandwidth. Meanwhile, the movie industry is following in the footsteps of the record companies by waging prolonged legal battles.

The question is, why?

"The Internet's graveyard is deep with companies that have been sued out of business by the entertainment industry," said Fred von Lohmann, an attorney with the Electronic Frontier Foundation, which advocates for the rights of Internet users. "I think the prevailing sense is that they are winning the battles but losing the war. Despite the lawsuits, there is more file sharing than ever."

Kori Bernards, an MPAA spokeswoman, said the organization doesn't reveal its strategy but she did outline the group's overall plan to deal with piracy.

"We are rooting out those who enable copyright infringement on the Internet," Bernards said. "We will continue to take such actions against sites that are profiting from the theft of other people's creative works...Our strategy is to go after people committing copyright theft on the Internet at all levels."

Copyright theft costs the film industry billions, according to the MPAA. In 2005, the top U.S. studios generated $23 billion in worldwide ticket sales but say they lost $2 billion, or 8 percent, to online piracy.

The lawsuits are little more than "scare tactics," declared Peter Sunde, one of the cofounders of The Pirate Bay, the Internet's largest trackers of BitTorrent files--the technology favored by many to transfer large amounts of data over the Web. Based in Sweden, The Pirate Bay's headquarters were raided by police last year after the U.S. government pressed Sweden to shut down the site. The efforts failed.

"The MPAA is using legal muscle to scare people but really they are the ones who are afraid," Sunde said. "They fear technology but technology always prevails."

Others suspect that the MPAA's ambitions go beyond trying to frighten file sharers. Ira Rothken, TorrentSpy's attorney, who has argued numerous copyright cases against the entertainment industry, argues the MPAA appears to be attempting to extend its control over Internet copyright issues.

First, rights holders pursued Napster for hosting unauthorized music files on Napster servers. They then went after Grokster and Streamcast, which produced software that was often used to pirate copyright content. (The courts ruled that the companies could not be held responsible for the criminal acts committed by users, but the Supreme Court reversed that decision.) And now the studios are after TorrentSpy, which does not have any direct contact with copyright material.

"It's one thing for someone to be hosting illegal copyright works on their site," Rothken said, "but the MPAA is trying to hold TorrentSpy liable for search results that link to torrent files. Copyright files never even touch TorrentSpy--not in any way, shape or form."

Lawsuits can pay off
Regardless of the criticism, there are signs that litigation does pay dividends. The MPAA is winning important decisions in the courts, most recently on May 29, when a U.S. magistrate judge ordered TorrentSpy to begin tracking user activity and then turn the data over to the MPAA.

TorrentSpy doesn't log such data, but the judge said that because the information exists, even if for only a short while, on computer RAM, TorrentSpy was obligated to collect and then turn the information over to the MPAA as part of the discovery process--where parties in a lawsuit exchange information. TorrentSpy has appealed the decision.

This kind of court ruling could be a very useful tool for fighting piracy, according to Richard Charnley, an attorney who has represented Fox and ABC in copyright cases.

"I think being able to access the identities of end users will certainly go a long way to shutting down potential infringement," Charnley said.

And TorrentSpy's recent moves indicate that perhaps the scare tactics also work.

Pirate Bay's Sunde was highly critical of TorrentSpy and its co-founder Justin Bunnell for launching a filtering system, called FileRights, that is designed to automatically remove links to infringing works. "First of all, Justin," wrote Sunde on his blog this week, "you know this is not going to work."

He suggests that TorrentSpy is either trying to save itself by appeasing the film industry or attempting to dupe the MPAA and the courts into believing that filtering BitTorrent files can effectively stop illegal downloads. It can't, according to Sunde.

Rothken points out that FileRights only automates the take-down process required by the Digital Millennium Copyright Act. For a long time, TorrentSpy and many U.S.-based competitors have removed links to copyright material when contacted by rights holders, he said.

So where does this leave the film industry if TorrentSpy and its competitors can't come up with a technology fix and they can't be sued into submission?

EFF's von Lohmann urges the movie industry to exercise some patience. He points out that if the studios were successful in killing off the VCR back in the 1970s, they would never have reaped billions of dollars from movie rentals.

"Everybody forgets that when the VCR was first developed, most of the uses were infringing copyright," von Lohmann said. "There was no Blockbuster or legitimate way to rent movies back then. It's vital to leave room for innovation. You have to give technology a chance to develop into something."

Meanwhile, Charnley and von Lohmann agree the studios must offer a more attractive proposition than the one being dangled by file sharing. They essentially have to learn to compete with free downloads.

"Ironically, if the studios changed their business model, that would put Napster's progeny out of business," Charnley said. "If they offer something that's legal, easy to use and affordable--these sites are useless."