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No Fair Use in File-Sharing Suit

In BMG Music v. Gonzales, No. 05-1314 (7th Cir., Dec. 9, 2005), the Seventh Circuit affirmed an Illinois District Court's finding of summary judgment in a copyright infringement action (based on file-sharing) decided under the illustrative rubric of MGM Studios, Inc. v. Grokster, Ltd., 162 L. Ed. 2d 781, 125 S. Ct. 2764 (2005).

In Gonzales, appellee copyright proprietors filed a copyright infringement action against appellant computer user, alleging that the user had infringed upon their copyrights when she downloaded copyrighted music from the Internet using the KaZaA file-sharing program. The user appealed after the United States District Court for the Northern District of Illinois, Eastern Division, granted summary judgment to the proprietors as to their infringement claims.

The user unsuccessfully argued that her activities were “fair use” of the proprietors' copyrighted material under 17 U.S.C.S. '107. The district court disagreed. It enjoined the user from further infringement and awarded the proprietors $22,500 in damages. On appeal, the user argued that she was entitled to a trial on her fair use claim because she had raised a material question of fact as to whether she had engaged in “fair use” under '107. The court found no error in the summary judgment entered for the proprietors. The user had downloaded more than 1,370 copyrighted songs, all of which were saved on her computer. She did not own legitimate copies of 30 of the songs. The district court properly awarded statutory damages under 17 U.S.C.S. '504(c). Section 402(d) barred any reduction in the statutory damages awarded pursuant to '504(c)(2) because the user had notice that the songs that she downloaded were copyrighted.

In debunking the appellant's “fair use” by trial agreement argument, the Court confirmed its technical savvy by noting that music downloads do not have to be saved on one's computer to be sampled.

“Licensed Internet sellers, such as the iTunes Music Store, offer samples ' but again they pay authors a fee for the right to do so, and the teasers are just a portion of the original. Other intermediaries … offer licensed access to large collections of music. New technologies, such as SNOCAP, enable authorized trials over peer-to-peer systems.

“With all of these means available to consumers who want to choose where to spend their money, downloading full copies of copyrighted material without compensation to authors cannot be deemed 'fair use.' Copyright law lets authors make their own decisions about how best to promote their works; copiers such as Gonzalez cannot ask courts (and juries) to second-guess the market and call wholesale copying 'fair use' if they think that authors err in understanding their own economic interests … Nor can she defend by observing that other persons were greater offenders; Gonzalez's theme that she obtained 'only 30' (or 'only 1,300') copyrighted songs is no more relevant than a thief's contention that he shoplifted 'only 30' compact discs, planning to listen to them at home and pay later for any he liked.”

In Entertainment Software Association v. Blagojevich, No. 05-C-4265, 2005 U.S. Dist. LEXIS 31100 (D. Ill., December 2, 2005), Plaintiffs, associations of entities involved in the video games industry, sued defendants, the Governor of Illinois, the Illinois Attorney General, and the Cook County, Illinois, State's Attorney, alleging that the Illinois Violent Video Games Law (VVGL) and Sexually Explicit Video Games Law (SEVGL), 2005 Ill. Laws 315, violated the First Amendment. The associations' preliminary injunction motion was combined with a trial on the merits.

The VVGL established criminal penalties for selling or renting violent video games to minors and failing to attach a label to such games stating “18.” The SEVGL created criminal penalties for selling or renting sexually explicit video games to minors and failing to label such games; the SEVGL also required retailers to post signs and make available brochures that explained video game ratings.

The court found that both statutes violated the First Amendment, ruling that the State failed to show that violent content in video games was directed to inciting or producing imminent lawless action or that violent video games were likely to produce imminent violence. Additionally, the State did not prove that the VVGL was narrowly tailored to serve a compelling government purpose. Also, the definition of “violent video games” under 720 Ill. Comp. Stat. 5/12A-10(e) was unconstitutionally vague. The SEVGL also was vague and not narrowly tailored; the definition of “sexually explicit” under 720 Ill. Comp. Stat. 5/12B-10(e) omitted the prong of the Miller obscenity test that a work lack “serious value.” The labeling, signage, and brochure provisions constituted compelled speech that did not withstand strict scrutiny.

No Fair Use in File-Sharing Suit

In BMG Music v. Gonzales , No. 05-1314 (7th Cir., Dec. 9, 2005), the Seventh Circuit affirmed an Illinois District Court's finding of summary judgment in a copyright infringement action (based on file-sharing) decided under the illustrative rubric of MGM Studios, Inc. v. Grokster, Ltd. , 162 L. Ed. 2d 781, 125 S. Ct. 2764 (2005).

In Gonzales, appellee copyright proprietors filed a copyright infringement action against appellant computer user, alleging that the user had infringed upon their copyrights when she downloaded copyrighted music from the Internet using the KaZaA file-sharing program. The user appealed after the United States District Court for the Northern District of Illinois, Eastern Division, granted summary judgment to the proprietors as to their infringement claims.

The user unsuccessfully argued that her activities were “fair use” of the proprietors' copyrighted material under 17 U.S.C.S. '107. The district court disagreed. It enjoined the user from further infringement and awarded the proprietors $22,500 in damages. On appeal, the user argued that she was entitled to a trial on her fair use claim because she had raised a material question of fact as to whether she had engaged in “fair use” under '107. The court found no error in the summary judgment entered for the proprietors. The user had downloaded more than 1,370 copyrighted songs, all of which were saved on her computer. She did not own legitimate copies of 30 of the songs. The district court properly awarded statutory damages under 17 U.S.C.S. '504(c). Section 402(d) barred any reduction in the statutory damages awarded pursuant to '504(c)(2) because the user had notice that the songs that she downloaded were copyrighted.

In debunking the appellant's “fair use” by trial agreement argument, the Court confirmed its technical savvy by noting that music downloads do not have to be saved on one's computer to be sampled.

“Licensed Internet sellers, such as the iTunes Music Store, offer samples ' but again they pay authors a fee for the right to do so, and the teasers are just a portion of the original. Other intermediaries … offer licensed access to large collections of music. New technologies, such as SNOCAP, enable authorized trials over peer-to-peer systems.

“With all of these means available to consumers who want to choose where to spend their money, downloading full copies of copyrighted material without compensation to authors cannot be deemed 'fair use.' Copyright law lets authors make their own decisions about how best to promote their works; copiers such as Gonzalez cannot ask courts (and juries) to second-guess the market and call wholesale copying 'fair use' if they think that authors err in understanding their own economic interests … Nor can she defend by observing that other persons were greater offenders; Gonzalez's theme that she obtained 'only 30' (or 'only 1,300') copyrighted songs is no more relevant than a thief's contention that he shoplifted 'only 30' compact discs, planning to listen to them at home and pay later for any he liked.”

In Entertainment Software Association v. Blagojevich, No. 05-C-4265, 2005 U.S. Dist. LEXIS 31100 (D. Ill., December 2, 2005), Plaintiffs, associations of entities involved in the video games industry, sued defendants, the Governor of Illinois, the Illinois Attorney General, and the Cook County, Illinois, State's Attorney, alleging that the Illinois Violent Video Games Law (VVGL) and Sexually Explicit Video Games Law (SEVGL), 2005 Ill. Laws 315, violated the First Amendment. The associations' preliminary injunction motion was combined with a trial on the merits.

The VVGL established criminal penalties for selling or renting violent video games to minors and failing to attach a label to such games stating “18.” The SEVGL created criminal penalties for selling or renting sexually explicit video games to minors and failing to label such games; the SEVGL also required retailers to post signs and make available brochures that explained video game ratings.

The court found that both statutes violated the First Amendment, ruling that the State failed to show that violent content in video games was directed to inciting or producing imminent lawless action or that violent video games were likely to produce imminent violence. Additionally, the State did not prove that the VVGL was narrowly tailored to serve a compelling government purpose. Also, the definition of “violent video games” under 720 Ill. Comp. Stat. 5/12A-10(e) was unconstitutionally vague. The SEVGL also was vague and not narrowly tailored; the definition of “sexually explicit” under 720 Ill. Comp. Stat. 5/12B-10(e) omitted the prong of the Miller obscenity test that a work lack “serious value.” The labeling, signage, and brochure provisions constituted compelled speech that did not withstand strict scrutiny.