Sony Corp. of Am. v. Universal City Studios, Inc.

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Sony v. Universal Studios, 464 U.S. 417 (1984), often called the Betamax case, was a landmark 1984 copyright decision by the U.S. Supreme Court. The defense defined by Sony has sheltered a wide array of technology innovators from lawsuits at the hands of the entertainment industries. In fact, it is thanks to the Betamax ruling that the makers of not just VCRs, but also every other technology capable of being used for infringement (e.g., photocopiers, personal computers, Cisco routers, CD burners, and Apple's iPod) can continue to sell their wares without fear of lawsuits from copyright owners.

The Supreme Court addressed a claim that secondary liability for infringement can arise from the very distribution of a commercial product, in this case the Betamax VCR. The movie industry sued Sony as the manufacturer. There was no evidence of stated or indicated intent to promote infringing uses, so Universal claimed Sony was contributorily liable for infringement that occurred when VCR owners taped copyrighted programs because it supplied the means used to infringe with knowledge that some consumers would use the VCRs to infringe. Id., at 439. Sony knew that its Betamax machines “would be used to record copyrighted programs," and survey evidence showed that, almost certainly, most users were, at one time or another, using the machines to make copies other than simply to “time shift” (watch a program once, later than when it aired)—though such time shifting was “the primary use . . . for most owners.” Id. at 423, 426.

But because the VCR was “capable of commercially significant noninfringing uses,” the Supreme Court held the manufacturer could not be faulted solely on the basis of its distribution. Id. at 442. Rather than focusing on the proportion of the uses are noninfringing, the Supreme Court ruled that a company was not liable for creating a technology that some customers may use for copyright infringing purposes, so long as the technology is "capable of substantial noninfringing uses." Id. at 442. In other words, where a technology has both legal and non-legal uses, the public cannot be denied the lawful uses just because some people (or many or most) may use the product to infringe copyrights. In Sony, the Court found non-infringing use in several forms. First, the Court determined that individuals used the Betamax for fair use purposes such as time-shifting. Essentially, users recorded TV programs originally offered to them for free because they couldn't watch them at the time the shows were broadcast. Furthermore, some programmers had no problem with such time-shifting because it actually increased their audience. The Court also concluded that the defendants were unable to prove that time-shifting impaired the commercial value of their copyrights or created any likelihood of future harm.

The studios brought up a number of possible modifications to the VCR, and the dissent noted that “Sony may be able . . . to build a {videorecorder] that enables broadcasters to scramble the signal of individual programs and ‘jam’ the unauthorized recording of them.” 464 U.S. at 494. Nevertheless, the majority opinion refused to require Sony to redesign the Betamax.

The Betamax was a new product at the time, and the Sony Court understood the tension between a desire to encourage new technology and a desire to protect the copyrights granted by the Constitution. In Sony, because the Court found the Betamax useful for legal purposes (i.e., fair use time-shifting), society had a greater interest in the device than in copyright protection. The Betamax case demonstrates how copyright law can be used to attack new innovations, even those that promote the profits and incentives of authors and creators. Copyright advocate Jack Valenti famously stated, "I say to you that the VCR is to the American film producer and the American public as the Boston strangler is to the woman home alone." Today more than 50% of the film industry's profits come from video and DVD sales and rentals. (ENTERTAINMENT MEDIA AND THE LAW 425 (Paul C. Weiler, ed. 2006)).

More on this case is available here

Chapter 3 - Copyright
General · Rights Acquisition · Infringement Issues · Digital Millennium Copyright Act (DMCA) · Non-Preemptable Common Law Claims