Course No.: 9200 710 801
Course ID:  17261
Tu 6:30-9:30 p.m.
Room W-215
Professor Jay Dratler, Jr.
Room 231D (IP Alcove)
(330) 972-7972
Copyright © 2000, 2001, 2002, 2003, 2004, 2005, 2006, 2008   Jay Dratler, Jr.  
For permission, see CMI.

Notes on Sony and Secondary Liability

1.  Sony is the pre-eminent decision of the Supreme Court on the subject of secondary liability for copyright infringement.  The Ninth Circuit refers to this case by a different name, Sony-Betamax, derived from the "Betamax" trademark of Sony's VTR, but both names refer to the same case.

After the Sony decision, the current VHS format for video tapes and cassettes won the battle in the marketplace, and Sony's proprietary Betamax technology rapidly became obsolete.  The technical differences between Betamax and VHS recording, however, have no bearing on the Sony Court's legal analysis.  Thus everyone assumes, with good reason, that Sony is still good law as applied to VHS tapes.  Since nothing in Sony turned on the fact that Betamax technology (like VHS) uses an analog format, there is also no reason why the same legal analysis should not apply to digital recording devices, such as recording DVD players.

2.  The Supreme Court rendered its decision in Sony in 1984, more than twenty years after the seminal decision on vicarious liability for copyright infringement, namely, Shapiro, Bernstein & Co. v. H. L. Green Co., 316 F.2d 304 (2d Cir. 1963).  The so-called "dance hall cases" cited in the Sony Court's footnote 18 also predate Sony, some by a long time.  Thus, the doctrines of vicarious liability and contributory infringement had been well established in copyright law, at least in the lower courts, long before the Sony decision.  See also, Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259, 262, 264 (9th Cir. 1996) (discussing origins of both doctrines in lower courts' case law).

Under these circumstances, why did the Sony Court deem it necessary to develop a whole new theory of contributory infringement by borrowing from patent law?  Would the "traditional" two-part test for vicarious liability and/or contributory infringement have applied on the facts of Sony?  If so, then why did the Sony Court go beyond them?  If not, then why did the two traditional tests for secondary liability not apply?

Is the Sony Court's standard for contributory infringement—that copying equipment not be "capable of substantial noninfringing uses"—a separate and distinct test or a special case of one or both of the two traditional tests?  If it is a distinct test, when does it apply, and when should a court apply one or both of the two traditional tests?

3.  It is conceptually obvious, as well as black-letter law, that there can be no secondary liability for copyright infringement without direct infringement, i.e., without an infringing act of someone for which the defendant is vicariously liable or to which the defendant contributed.  See, e.g., Arista Records, Inc. v. MP3Board, Inc., 2002 U.S. Dist. LEXIS 16165 at *10, CCH Copy. L. Rep. ¶ 28,483 (S.D.N.Y. Aug. 28, 2002) ("In order to establish liability for contributory or vicarious copyright infringement, a plaintiff must first prove that direct infringement of its works occurred by showing that it owned a valid copyright and unauthorized infringement of its protected material occurred") (citation omitted.); id., 2002 U.S. Dist. LEXIS 16165 at *3, 11 (denying plaintiffs summary judgment on contributory and vicarious infringement claims because they "failed to prove that any direct infringement resulted from [defendant's] operations"); In re Aimster Copyright Litigation, 2002 U.S. Dist. LEXIS 17054 at *29-30, CCH Copy. L. Rep. [para]28,500 (N.D. Ill. Sept. 4, 2002) ("the first step in assessing the existence of contributory infringement is determining the existence of the underlying and direct infringing [*30] activity by a third party-in this case, Aimster's users"), aff'd 334 F.3d 643, 67 U.S.P.Q. (BNA) 1233 (7th Cir. 2003); Greenberg v. National Geographic Society, 2001 U.S. App. LEXIS 4270 at *10 n.6 (11th Cir. Mar. 22, 2001) ("there can be no contributory infringement without a finding that there was direct copyright infringement by another party"), citing Cable/Home Communication Corp. v. Network Productions, Inc., 902 F.2d 829, 845 (11th Cir. 1990).

In a portion of its opinion not reproduced above, the Sony court reached the much-celebrated conclusion that private, noncommercial time-shifting of copyrighted television programs available for free off the air is fair use, and not copyright infringement.  As the Sony case reached the Supreme Court, this was the only act of direct copyright infringement that the plaintiffs had alleged. Under these circumstances, the Sony Court could have analyzed time-shifting first, rather than at the end of its long opinion.  Then it could have simply noted the principle "no direct liability, no secondary liability," provided a few relevant citations, and exonerated Sony in one sentence, on the ground that there had been no direct infringement to which Sony could have contributed.

By so doing, the Sony Court could have avoided the whole enterprise of borrowing from patent law to weave a doctrine of contributory liability in copyright out of whole cloth.  Instead, the Court began its analysis with the question of contributory liability, developed a whole new, nonstatutory standard for it in copyright law, and reached the question of fair use only in applying that standard.

Why did the Supreme Court take this approach?  Normally, courts make decisions on the narrowest ground possible.  Yet in Sony the Court borrowed from patent law to create a general rule for contributory infringement of copyright, despite the fact that it did not have to do so to decide the case before it, and despite its own warning that copyright and patent, "naturally, are not identical twins, and we exercise the caution which we have expressed in the past in applying doctrine formulated in one area to the other."  Court's footnote 19 (citation omitted.)  Does that fact that the Supreme Court could have decided Sony without borrowing this test from patent law mean that the test is dictum that can be ignored or circumvented in subsequent cases?  Does the fact that the Sony Court began its analysis with the test suggest how likely the Court will be to apply it in succeeding cases?

4.  The Copyright and Patent Clause (sometimes called the "Intellectual Property Clause") of the United States Constitution authorizes Congress "To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries . . . ."  U.S. Const. Art. I, § 8, Cl. 8.  As the grammatically parallel structure of the Clause suggests, the word "Science" pertains to copyright, while the words "useful Arts" pertain to patents.  This juxtaposition makes sense because, in the Framers' time, the word "Science" (derived from the Latin word scientia) meant "knowledge" or "book learning," while the term "useful Arts" corresponded roughly to the concept of "technology" today.

In any event, the Clause treats copyright and patents much the same and indeed mentions both in the same breath.  If the Sony Court had found Sony liable and enjoined the production and sale of Sony's Betamax VTR's, would that decision have "promote[d] the Progress of . . . useful Arts" as the Constitution demands?

Some have argued that enforcing copyright protection in new technological environments (such as video recording, digital audio tape, and peer-to-peer file sharing over the Internet) necessarily retards the development and use of new technology.  They reason that there is no incentive to develop and market new technology for disseminating creative expression if the courts view that technology as contributing to copyright infringement and therefore enjoin or limit its use.  How persuasive is this reasoning?

Are cases like Sony therefore of constitutional dimension because, in practice, they implicate the balance between protecting creative expression under copyright and encouraging the advance of technology through patents?  Does the Constitution require Congress to promote progress in both creative expression and technology simultaneously, or can Congress trade one goal off against the other when and if they conflict in practice?  Could Congress outlaw particular technologies entirely in order to protect copyright?  See 17 U.S.C. § 1201(k) (prohibiting manufacture and distribution of video cassette recorders unless they have certain narrowly specified properties).

Does the Sony Court hint at the answers it might give to these questions when it says, "[a]s the text of the Constitution makes plain, it is Congress that has been assigned the task of defining the scope of the limited monopoly that should be granted to authors or to inventors in order to give the public appropriate access to their work product"?  Yet suppose that Congress forbade all Internet peer-to-peer file sharing over the Internet for the express purpose of protecting copyrights.  Suppose further than Congress justified the prohibition with voluminous citations to evidence that copyright infringement by peer-to-peer file sharing threatens the viability of the music and movie industries as currently configured.   Would/should such a law pass constitutional muster?

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