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Hollywood -v- Grokster, Morpheus

Hollywood’s latest attempt to dominate the embryo commercial p2p file sharing industry and, hence, how people handle music and other digital media online, starts tomorrow.

In a telling blow to the major movie studios and recording companies, last year US District Court Judge Stephen Wilson ruled the owners of the p2p programs Grokster (Grokster Ltd) and Morpheus (Streamcast Networks Inc) couldn’t control how people use their apps and so couldn’t be held liable for piracy by third-party users.

Wilson cited the 1984 Sony Betamax case where Hollywood tried to have VCRs banned. However, the Supreme Court ruled that use of new technology to infringe copyrights didn’t justify such an action.

“Grokster and Streamcast are not significantly different from companies that sell home video recorders or copy machines, both of which can be and are used to infringe copyrights,” he decided.

On Tuesday, lawyers from both sides will try to convince the 9th US Circuit Court of Appeals that their clients’ view of online p2p file swapping is the only one.

As the main thrust of their cases tomorrow, Grokster and StreamCast will say their software has valuable, and legitimate, business and academic applications and that they can’t control what files users do with their program and thus, can’t be held responsible.

Hollywood, on the other hand, will say it’s losing millions, if not billions, of dollars as p2p users share compressed song and movie files. Consequently, the labels and studios are demanding that the services are either closed, or stopped from doing what they do.

Also lined up is Kazaa, owned by Sharman Networks and a co-defendant added after the case was in progress and therefore not included in Wilson’s summary judgment ruling.

In another ruling that set Hollywood back on its heels, Wilson said Sharman can sue the RIAA (Recording Industry Association of America) and MPAA (Motion Picture Association of America) for copyright-infringement and breach of contract.

Rejecting arguments by the labels and studios that Sharman’s allegations were too vague, Wilson decided specificity wasn’t an issue at this stage of the case.

Among other things, the RIAA and MPAA have been posting phony mp3 files on p2p networks as part of their bid to shut down p2p file sharing. Sharman says the two Hollywood trade organs also used Kazaa software to track users and send threatening messages, “in a violation of Kazaa’s terms for using the network,” states the report.

To say this is a genuine example of David battling Goliath is a considerable understatement.

If the the labels and studios - and by default, the other components of the Hollywood Green Machine such as many (most?) major hardware and software companies - win, they’ll Rule.

They’ll have Grokster and Morpheus locked and they’ll use the weight of the decision, together with their tremendous political power and financial clout, to literally control what people do, how they do it, and with what.

With the RIAA up front, Big Music has been instituting a vicious sue ‘em all campaign against file sharers and is currently trying to finally cow file swappers by lodging another 532 lawsuits against alleged copyright breakers, bringing the total of the number of people it has, or has had, under threat to nearly 1,000.

Hollywood has a lot of support but that’s not because it’s deeply loved. Rather, many of the people and organizations backing it in this fight are told: ‘Stand alongside us - or suffer the consequences!’

Last year, songwriters and music publishers - 27,000 of them, according to the National Music Publishers Association - filed a friends of court brief demanding that the 9th Circuit overturn the lowerStreamCast and Grokster ruling.

And a similar brief was filed by law professors from Harvard University, New York University and other universities, as well as, “Pressplay, MusicNet, Full Audio and other music services; and international film, music, video and other copyright organizations” to support Hollywood.

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