CSU Business Law Case Study

Copyrights Discussion

Read Chapter 14 (pp. 509-523)

Homework: Assignment #1: BitTorrent Case Study

I will be attaching the pages and class Powerpoint.

BitTorrent Case
Increasing and Capturing the Value of Knowledge
Assets
BitTorrent
• If you were David Chao, would you invest
in BitTorrent?
• What are some potential benefits to
investing in BitTorrent? What has
BitTorrent done differently than its
predecessors?
• (Breakout Groups Questions 1-2)
BitTorrent
• What are some issues BitTorrent may face
that would make David Chao’s investment
uncertain?
BitTorrent
• Potential Liability for Copyright Infringement
• Did BitTorrent infringe the rights of copyright
holders whose works were being copied and
distributed using BitTorrent’s software?
BitTorrent
• Contributory Infringement: occurs when a
party:
• a person knowingly/actively induces another
to commit direct infringement or
• causes the directly infringing conduct.
BitTorrent
• Vicarious Copyright Infringement: Liability for
vicarious infringement attaches to a person who:
•
has the right and ability to supervise a direct
copyright infringement and
• who has a direct financial interest in the
infringement.
BitTorrent
• Doctrine of Fair Use
• Purpose and character of use (commercial or
nonprofit educational purpose)
• Economic effect on the market or value of the
copyrighted work
• Amount of work used
BitTorrent
• Sony Multimedia case (Sony v. Universal City
Studios).
• What were consumers doing with their Betamax
cassette recorder?
• Did Sony commit contributory infringement by
manufacturing and selling the Betamax video
cassette recorder or was it fair use?
Napster
• Breakout Groups (5-7)
• Napster:
• Background:
• What is it?
• What did it do?
BitTorrent
• Did Napster engage in contributory
infringement through its P2P file-sharing
system? If so, how?
BitTorrent
• Napster:
• Is Napster liable for vicarious copyright
infringement? If so, why?
BitTorrent
• (Breakout Groups 8-11)
• Grokster:
• What is it?
• What did it do?
BitTorrent
• Was Grokster liable for vicarious
infringement because its users were
directly infringing on copyrighted
material by sharing music files?
BitTorrent
• Contributory Infringement
• Is Grokster liable for contributory
infringement? Why?
• Did Grokster actively induce its users to
engage in copyright infringement?
• If so, how?
BitTorrent
• What steps could Napster and Grokster
have taken to avoid lawsuits from
copyright holders or to limit their legal
liability?
BitTorrent
• Would BitTorrent be liable for contributory
infringement? Compare and contrast their
actions to Napster and Grokster’s actions.
• Did BitTorrent do things differently than its
predecessors?
• (Breakout Groups 12-13))
BitTorrent
• Does BitTorrent have vicarious liability for
copyright infringement?
BitTorrent
• If you were David Chao, would you invest in
BitTorrent?
• Why or why not?
BitTorrent
• What are the public policies behind the
decisions in Sony, Diamond MultiMedia, and
the Grokster decisions?
• In Sony and Diamond MultiMedia-no copyright
infringement
• In Grokster (9th Circuit Court of Appeals) also
found no copyright infringement. Unless
specific knowledge of infringement at the time
it occurs.
• What happens when laws are too restrictive?
BitTorrent
• Who is better equipped to establish rules
governing new technologies-legislature or
courts and why?
• Pros/Cons for legislature
• Pros/Cons for judiciary
BitTorrent
•
Legal Astuteness: ability of top management teams to
communicate effectively with legal counsel and to work
together to solve complex problems and to protect and
leverage the company’s resources. Four Components:
•
•
•
•
a set of value-laden attitudes
a proactive approach
the ability to exercise informed judgment
context-specific knowledge of the law and the proper
application of legal tools.
BitTorrent
•
Key Legal Issues/Ideas to Keep in Mind When Reading Warner
Brothers and BitTorrent
•
•
•
•
•
•
How did David Chao use Legal Astuteness when deciding to
invest in BitTorrent?
Threats to Movie Industry from online sources
Opportunities for Movie Industry with online sources
Lessons from Music Industry
Apple
Key Deal Points/Role of Warner Lawyers
BitTorrent
1. Why haven’t the record companies or film studios tried to shut down the main BitTorrent
site? What actions by BitTorrent would make them more or less likely to sue?
2. Did Napster engage in contributory infringement through its P2P file-sharing system?
Explain.
3. Is Napster liable for vicarious copyright infringement because it provided a platform for users
to download and share copyrighted music? Explain.
4. Was Grokster liable for vicarious infringement because its users were directly infringing on
copyrighted material by sharing music files? Explain.
5. Is Grokster liable for contributory copyright infringement? Why?
6. Would BitTorrent be liable for either: contributory infringement or vicarious infringement?
Why or why not?
7. What are the public policies behind the decisions in Sony and Diamond Multimedia?
8. What could Napster, Hummer Winblad, and Grokster have done to avoid liability or to have
secured a stronger position with respect to the legal actions that unfolded?
9. If you were David Chao of DCM, would you invest in BitTorrent? Why or why not?
10.
Is there any way to limit DCM’s legal liability or financial exposure if Chao decides to
invest?