1. File Sharing Networks: Sony, Napster, Grokster, Bit Torrent
Richard Warner

2. Sony v. Betamax
Recording complete TV shows for the personal purpose of time-shifting does not infringe copyright. It is fair use.
Providing a recording device that can be used to infringe copyright is not contributory copyright infringement “if the product is widely used for legitimate, unobjectionable purposes. Indeed, it need merely be capable of substantial noninfringing uses.”

3. Contributory Infringement/Vicarious Liability
Vicarious liability: the right and ability to control users; and a direct financial benefit from the wrongful activity.
Contributory infringement: knowledge of the infringing activity, and a material contribution (actual assistance or inducement).

4. How Napster Works

5. The Central Server
The Napster central servers had a complete list of every shared song available on every hard disk connected to Napster at that time.
Copyright law allows friends to share music with friends.
The legal theory behind Napster: "All of the people on Napster are sharing songs with friends."

6. Napster Is Illegal
Napster users violate copyright when they download copyrighted works without permission.
Napster also incurs legal liability.
Vicarious liability: the right and ability to control users; and a direct financial benefit from the wrongful activity.
Contributory infringement: knowledge of the infringing activity, and a material contribution (actual assistance or inducement).

7. How Grokster Works

8. No Central Server
No central database indexes all of the files on the Gnutella network. The machines tell each other about available files.

9. Is Grokster Illegal?
Vicarious liability: the right and ability to control users; and a direct financial benefit from the wrongful activity.
Grokster lacks the right and ability to control.
Contributory infringement: knowledge of the infringing activity, and a material contribution (actual assistance or inducement).
Grokster has no specific knowledge of infringing activity.

10. Inducement “We hold 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.”
MGM Studios v. Grokster

11. Does It Violate Copyright Law Merely Maintain A Gnutella Network?
Vicarious liability: the right and ability to control users; and a direct financial benefit from the wrongful activity.
No right and ability
Contributory infringement: knowledge of the infringing activity, and a material contribution (actual assistance or inducement).
No knowledge
Inducement: 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.
No company or organization.

12. BitTorrent
Index server

13. Operators of Bit Torrent Index Servers
Operators can be liable for copyright violation under an inducement theory.