Copyright's Digital Dilemma Today: Fair Use or Unfair Constraints? Part I: The Battle over File Sharing

In short order, the RIAA issued numerous subpoenas and much to the credit of Verizon (in its role as an ISP), the company refused to release the demanded customer data. RIAA thereafter filed a motion in the U.S. District Court for the District of Columbia to enforce compliance in October of 2002. Unfortunately, individual rights were the loser: first, on January 22, 2003, the court rejected Verizon's statutory challenges based on the fact that the RIAA's subpoena related to material transmitted over Verizon's network (rather than stored on it) and thus fell outside the scope of the subpoena power authorized by §512(h). And second on April 24, 2003, the court also rejected Verizon's constitutional claims based on the argument that the subpoena power violates Article III of the Constitution (because it authorizes federal courts to issue binding process in the absence of a pending case or controversy) as well as the First Amendment rights of Internet users. A week later, the D.C. Circuit Court of Appeals refused a stay, thus requiring immediate compliance by Verizon of the release the names and addresses.

A Risk Assessment for Networks and Individuals

The risk posed by the recording industry to individuals trading copyrighted content - as well as corporate entities that provide connectivity to employees, students and others - is substantial and real. It is substantial in terms of civil and criminal penalties. Civil remedies for copyright infringement may include actual damages or statutory damages - an alternative form of recovery since actual damages may be difficult to prove or limited in dollar amount in typical cases. Statutory damages are specified in three categories for each single infringement of a single work: normal with damages from $750 to $30,000; willful with damages increasing to $150,000; and innocent with a court allowed to reduce damages to an amount not less than $200. Clearly the stage is being set to obviate any claim of innocent infringement and impose willful penalties. Moreover, criminal penalties for individuals are also a real risk especially given the passage of the No Electronic Theft (NET) Act, an amendment in 1997 that removed the personal financial gain or commercial advantage element and provides for penalties that include up to five years in prison and/or $250,000 fines and a statute of limitations extended from three to five years.

And it is real in terms of the extent of infringement and the clear actions underway by the industry. Although a substantive appeal of the Verizon litigation was to be heard in September 2003 by the Court of Appeals, the wheels of litigation against individuals began almost immediately - on June 26 the RIAA announced publicly that they were "preparing a wave of civil lawsuits against people who use musictrading software." Targeting would include the public directories of peer-to-peer providers and according to privacy advocates at the Electronic Privacy Information Center (EPIC), some 57 million Americans could be liable to these "dinosaurs [that] have completely lost touch with reality." As of late July and reported by the Washington Post, over 1,000 such subpoenas had been issued with a rate of at least 75 additional per day.