First Impact

On the surface, the Grokster decision seems a slap in the face to both innovators and the casual downloader, as it could be interpreted to place inventors of technology at risk for liability if they fail to safeguard their inventions from illegal use. The court barred Grokster from protection under the Sony rule because it could be interpreted based on the merits that Grokster acted intentionally to capture a market of abusers. They held that "one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties."

Some are quick to interpret this decision as an affront to the process of innovation, and envision that future distributors of p2p or other sharing technologies would be required to carefully document the steps they take to avoid inducing infringement. Some see this as hedging on the Sony rule territory, and could lead to vast uncertainties on who is and is not liable of vicarious infringement, and particularly what constitutes active inducement. Brian's Brain holds such an opinion.

However, the court carefully trods around the Sony rule, stating very explicitly that "of course, in the absence of other evidence of intent, a court would be unable to find contributory infringement liability merely based on a failure to take affirmative steps to prevent infringement, if the device otherwise was capable of substantial noninfringing uses" [fn12]. Thus, the decision can only apply where "the plaintiff is able to show, by direct or indirect evidence, that the defendant intended users to engage in copyright infringement and encouraged them to do so" (Reed Smith).

The Supreme Court is being criticized for not clearly defining the criteria under which it can be shown that a company is promoting the infringement of copyright to its users. However, that is not their responsibility. They merely need to see enough evidence to believe that such a claim might be found by a trial court. Many contend that the decision in Grokster will only be used in the narrow arena of P2P software and its cousins. This is argued in further detail on Forbes.com.

The long-term impact remains to be seen. What happens at trial may be entirely different from what is expected by the suggestions following the Supreme Court's decision. As Charles Petit mentions on IT Conversations, the sealed record of the case likely contains some "juicy little bits" that could decide the fate of Grokster, or even change the trial's course so drastically as to make it unrecognizable. The trial may have less to do with the specific technology of p2p than it does the sanctions of the record industry in general. At this point, such conjecture is purely speculative.