In a significant setback for the recording industry, a federal appeals court ruled Friday that Internet service providers cannot be forced to turn over the names of subscribers who are suspected of illegally sharing music on line.
The ruling by a three-judge panel expressed sympathy for the recording industry, which has been hit hard by piracy and file sharing among computer users. But it concluded that nothing in the law authorizes subpoenas against Internet service providers compelling them to identify customers who might be engaging in copyright infringement.
By coincidence, the ruling came on the same day the Dutch Supreme Court ruled that the makers of Kazaa, the world's most popular computer file-sharing program, cannot be held liable for copyright infringement of music or movies swapped on its free software. The ruling in Amsterdam upheld last year's appellate court verdict dismissing a suit filed by a group on behalf of the music industry.
The Washington ruling, by the US Court of Appeals for the District of Columbia Circuit, focused on the 1998 Digital Millennium Copyright Act, which, as the court said Friday, has already been outstripped by technology, especially the ever-expanding ability of Internet users to find and retrieve files on one another's computers.
"It is not the province of the court, however, to rewrite the DMCA in order to make it fit a new and unforeseen Internet architecture, no matter how damaging that development has been to the music industry or threatens being to the motion picture and software industries," Chief Judge Douglas Ginsburg wrote for the unanimous panel.
The winner today was Verizon, which had challenged the recording industry's interpretation of the 1998 law. The loser was the Recording Industry Association of America (RIAA), which has sued hundreds of computer users. Some of those sued have expressed dismay that their Internet service providers turned over information about them without their consent.
Verizon argued that, if it complies with subpoenas, it violates the subscribers' right to privacy. The company had also asserted that the special subpoenas, obtainable through a court clerk rather than by a judge's signature, are improper in themselves -- "a radical, new subpoena process," in the words of Sarah Deutsch, vice president and associate general counsel for Verizon.
Friday's ruling is surely not the last word on the issue, either in the courts or in Congress.
"Regardless of this decision, we will continue to defend our rights online on behalf of artists, song-writers and countless others involved in bringing music to the public," Cary Sherman, president of the RIAA, said. "We can and will continue to file copyright infringement lawsuits against file sharers who engage in illegal activity."
Although Sherman was not explicit about his group's plans to carry the court fight further, an appeal to either the full Circuit Court or to the Supreme Court seems inevitable, given the enormous importance of the issues involved.
Deutsch of Verizon said Friday's ruling removes a threat to privacy.
"Copyright holders seeking personal information about Internet subscribers will now have to file a traditional lawsuit" rather than obtaining subpoenas without having to go to a judge, she said.
Further legislative action in Congress also seems inevitable, as lawmakers try to keep up with the dizzying pace of technological changes. At least two congressional committees are already re-examining the 1998 law. Friday's appeals court ruling seemed to urge Congress to take action.
"The plight of copyright holders must be addressed in the first instance by the Congress," the court said. "The stakes are large for the music, motion picture and software industries and their role in fostering technological innovation and our popular culture."
Friday's ruling overturned a district court ruling that had compelled Verizon to turn over the names of some subscribers to music industry lawyers.
The industry association signaled its determination in a letter three days ago to Ivan Seidenberg, Verizon's chief executive.
"We would like to work with you to supplement our efforts by arranging for ISPs to notify their subscribers who are engaged in infringing activity that this conduct is illegal," Sherman and Mitch Bainwol, the association's general counsel, wrote.
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