A & M Records, Inc. v. Napster Inc.
A & M Records, Inc. v. Napster Inc., 239 F.3d 1004 (9th Cir. 2001)
Plaintiff recording companies sued file-sharer Napster for contributory and vicarious copyright infringement, and obtained a preliminary injunction from the district court. Id. at 1011.
The court held that downloaders infringed the reproduction right and uploaders infringed the distribution right, and that fair use did not apply. Id. at 1014. In doing so, the court rejected sampling and space-shifting where others would also gain access to the files as fair uses. Id. at 1018-19.
The court held that "if a computer system operator learns of specific infringing material available on his system and fails to purge such material from the system, the operator knows of and contributes to direct infringement" and that the "record support[ed] the district court's finding that Napster [had] actual knowledge that specific infringing material [was] available using its system, that it could block access to the system by suppliers of the infringing material, and that it failed to remove the material." Id. at 1121-22. The court held Napster materially contributed to the infringement by providing the "site and facilities." Id. The court also upheld the district court's ruling on vicarious liability, find that "Napster's failure to police the system's 'premises,' combined with a showing that Napster financially benefits from the continuing availability of infringing files on its system, leads to the imposition of vicarious liability." Id. at 1024.
Napster sought protection against secondary liability from DMCA § 512. The Ninth Circuit refused to adopt a blanket conclusion that the DMCA could never protect secondary infringers, noting that congressionals reports indicate congressional intent to provide protection from secondary liability. Id. at 1025. The court held that DMCA protection was an issue more suitable for trial upon further development of the facts, and that plaintiffs had raised sufficient questions to tip the balance of hardships in their favor for purposes of deciding preliminary relief. Id. The court stated that the issues included: (1) whether Napster is an Internet service provider, (2) whether copyright owners must give a service provider “official” notice of infringing activity for it to have knowledge of the activity and (3) whether Napster had complied with Section 512(i) of the DMCA, which requires a service provider to establish a detailed compliance policy. Id.