In Re Aimster Copyright Litig.
252 F. Supp. 2d 634 (N.D. Ill. 2002)
Recording companies sued Aimster claiming that its peer-to-peer file sharing system contributorily and vicariously infringed their copyrights in musical works. Id. at 639. In granting a preliminary injunction, the court found that users of the Aimster system engaged in direct copyright infringement by transferring digital copies of music without permission, and that such transfers were not "personal use" under the Audio Home Recording Act. Id. at 648-49.
The court found Aimster had at least constructive knowledge of the infringement even though Aimster, due to its encryption technology, did not have specific knowledge of individual transfers between users because the RIAA sent screenshots showing lists of songs available from user's hard drives, Aimster's tutorial used copyrighted song names as examples, Aimster kept track of the top songs being downloaded by users, and users openly discussed infringement on Aimster's message boards and chatrooms. Id. at 650-51. The court also found Aimster materially contributed to the infringement by providing the means and differed from service providers like ISPs or IMs because it enticed users to download copyrighted songs. Id. at 652.
The court rejected Aimster's Sony defense, finding that there was little evidence that Aimster was substantially used for noninfringing purposes and describing it more as a service than a product because the ongoing relationship Aimster had with its users. Id. at 653-54.
With regard to vicarious infringement, the court found Aimster had the right and ability to control because it could terminate individual users, and that Aimster had a direct financial interest because it charged $4.95 from Club Aimster members. Id. at 655.
Aimster was found ineligible for Section 512 safe harbor because Aimster had not reasonably implemented a ‘repeat infringer’ policy. Id. at 659-60. While it had a repeat infringer policy, the policy did not result in any terminations because, due to the encryption technology, it was impossible to identify which users actually engaged in the transfer of specific files, rather than simply had them on their hard drives (which the court indicated was not infringing). Id.