Fixing through legislative fixation: a call for the codification and modernization of the staple article of commerce doctrine as it applies to copyright law.

AuthorReese, Blake Evan

INTRODUCTION I. THE HISTORY OF THE STAPLE DEFENSE A. Early Copyright Cases Tackle Dual-Use Technologies 1. Sony: The Technology of Time-Shifting a. The District Court's Opinion: The Staple Defense Sneaks into Copyright Law b. The Ninth Circuit's Opinion c. The Supreme Court's Opinion: Mr. Rogers Sides with Technology and Five Justices Side with Mr. Rogers i. Justice Stevens's Dicta ii. Justice Blackmun's Dissenting Opinion 2. RCA Records: Controlling the Use of Copyrighted Works 3. Vault Corp.: The Defendant Wins One a. The District Court's Decision b. The Fifth Circuit's Decision B. The Next Generation of Infringement: The Peer-to-Peer Network Cases 1. Napster: Sampling and Space-Shifting a. The District Court's Decision b. Chief Judge Patel's Dicta c. The Ninth Circuit's Opinion 2. In re Aimster: The Mere Potential for Nonfringing Use a. The District Court's Opinion b. The Seventh Circuit's Opinion c. Judge Posner's Dicta 3. Grokster: Promoting Use for Infringement a. The District Court's Opinion b. The Ninth Circuit's Opinion c. The Supreme Court's Opinion i. The Majority's Opinion ii. Justice Ginsburg's Concurring Opinion iii. Justice Breyer's Concurring Opinion II. A LEGISLATIVE PROPOSAL A. Text of This Author's Proposed Bill B. Legislative Intent of Proposed Bill 1. Bright-Line Rules Are Better than Uncertain Broad Principles 2. Balancing the Policies of Copyright Law 3. The Proposed Legislation Does Not Abandon the Weight Given to Potential Uses 4. Specific Times, Limits, and Infringement Ratios Define Whether or Not Technologies Are Socially Desirable 5. Other Proposed Legislation Has Not Addressed the Issues Addressed in the Legislation Proposed Here 6. The Proposed Legislation Is Consistent with the Aforementioned Case Law CONCLUSION INTRODUCTION

In 1979, a district court applied an affirmative defense to secondary patent infringement in a copyright infringement case. (1) The court did so in order to protect a technology developer from copyright liability caused by third parties using the developer's product in an infringing manner. (2) The court's intention was to avoid quashing a new technology that was capable of many noninfringing uses and, thus, to prevent an inequitable infringement judgment against an innovator solely because individuals, outside the developer's control, used the product illegitimately. (3) Over the next twenty-six years, district courts, courts of appeal, and the U.S. Supreme Court have misinterpreted and disagreed with each other's decisions--and even at times with their own decisions--over how to apply relevant principles of patent law in copyright cases, that is, to strike the proper balance between protecting copyright holders' rights without restricting innovation. (4) As the courts have battled over this issue, billions of dollars of infringement have occurred using new technology mediums, and once promising start-up companies have gone bankrupt because of copyright infringement judgments against them. (5) As Justice Fortas so wisely said in addressing the new technology of cable television:

[T]he fact that the Copyright Act was written in a different day, for different factual situations, should lead [the judiciary] to tread cautiously here. Our major object, I suggest, should be to do as little damage as possible to traditional copyright principles and to business relationships, until the Congress legislates and relieves the embarrassment which we and the interested parties face. (6) Unfortunately, the courts have not tread with caution and have done much damage to the balance of copyright's competing policies, which has left both copyright owners and technology innovators facing great uncertainty. Accordingly, Congress must step in and combat this uncertainty by codifying a modern version of the Staple Article of Commerce Doctrine's affirmative defense (Staple Defense) into the Copyright Act.

This Comment discusses the history and common law development of the Staple Defense, this author's legislative proposal, and why such a proposal both clarifies the ambiguities caused by the current judicial doctrine and strikes the proper balance of the competing policies that underlie copyright.

  1. THE HISTORY OF THE STAPLE DEFENSE (7)

    1. Early Copyright Cases Tackle Dual-Use Technologies

      1. Sony: The Technology of Time-Shifting

        a. The District Court's Opinion: The Staple Defense Sneaks into Copyright Law

        In Universal Studios, Inc. v. Sony Corp. of America, the copyright owners of publicly broadcast television shows sued the manufacturer and distributor of a videotape recording device, the corporations that sold and promoted the device, and a home user that operated the device for violations under the Copyright Act. (8) First, the district court determined that the copyright owners could not establish direct infringement for home users recording publicly broadcast works because the court found "time-shifting" to be a fair use. (9) Although the court's finding ruled out holding the defendants liable for secondary liability, the district court, in dicta, explored the possibility of secondary liability if the home use was infringing use. (10) In order to explore such possibilities, the district court surveyed the then current state of secondary liability. (11) Because the Copyright Act was silent on secondary liability, the district court noted two cases that addressed contributory liability for copyright infringement and distinguished them from the facts before the court. (12) Specifically, the district court stated the following:

        Plaintiffs' claims are unprecedented. Unlike the defendant in Gershwin, defendants here do not arrange for and direct the programming for the infringing activity. Unlike the defendants in Screen Gems I and II, defendants here do not sell or advertise the infringing work. Plaintiffs sue defendants because they manufacture, distribute, advertise and sell a product capable of a variety of uses, some of them allegedly infringing. .... Whether or not patent law has precedential value for copyright law and the Betamax is capable of "substantial" noninfringing use, the underlying rationale for the patent rule is significant. Commerce would indeed be hampered if manufacturers of staple items were held liable as contributory infringers whenever they "constructively" knew that some purchasers on some occasions would use their product for a purpose which a court later deemed, as a matter of first impression, to be an infringement. (13) Finally, the court discussed the defendants' hypothetical vicarious Liability (14) by noting they did not sufficiently participate in and benefit from home users recording publicly broadcast works to satisfy the requirements to be held liable under such claims. (15)

        b. The Ninth Circuit's Opinion

        On appeal, the Ninth Circuit took a different stance than the district court by holding that the act of home recording does not qualify as a fair use and thus is a direct infringement. (16) The court found the defendant-sappellees to be contributorily liable for the direct infringement carried out by the home recording because they knew their device would be used to reproduce copyrighted works and "there [was] no doubt" they "induc[ed], caus[ed], or materially contribut[ed] to the infringing conduct." (17)

        The Ninth Circuit addressed the district court's dicta application of the Staple Defense by stating that "[v]ideotape recorders are manufactured, advertised, and sold for the primary purpose of reproducing television programming. Virtually all television programming is copyrighted material. Therefore, videotape recorders are not 'suitable for substantial noninfringing use.'" (18)

        c. The Supreme Court's Opinion: Mr. Rogers Sides with Technology and Five Justices Side with Mr. Rogers

        The Supreme Court granted certiorari and after a tutorial on copyright policy, the Court embraced secondary liability as implied by the Copyright Act. (19) The Supreme Court carefully presented the principle that finding secondary liability for copyright infringement increases the scope of the copyright holder's monopoly and recognized the need to balance this augmentation so as not to "extend [the copyright holder's] monopoly beyond the limits of [his or her] specific grant." (20) Accordingly, the Court cited patent law for the principle to combat this increase by "expressly provid[ing] that the sale of a 'staple article or commodity of commerce suitable for substantial noninfringing use' is not contributory [copyright] infringement." (21) As the stage was set, the Supreme Court stated that "the sale of copying equipment, like the sale of other articles of commerce, does not constitute contributory infringement if the product is widely used for legitimate, unobjectionable purposes. Indeed, it need merely be capable of substantial noninfringing uses." (22)

        Next, the Court jumped right into the deep end and asked whether the device at hand was "capable of commercially significant noninfringing uses." (23) However, in the same paragraph in which it posed that question, it refused to decide "how much use [would be] commercially significant"; instead, the Court found that the "potential use" of home users operating the device for time-shifting purposes met the requisite threshold. (24) In answering the aforementioned question, the Court found the use to be substantially noninfringing because plaintiffs-respondents had a combined relevant market share of less than ten percent. (25) With respect to the other ninety percent of the market share, the Supreme Court cited the district court's injunctive relief findings to establish that "a significant quantity of broadcasting" had authorized time-shifting and "a significant potential for future authorized copying" existed. (26) To further support this proposition, the Court cited the testimony of Mr. Rogers (27)--the defendants-petitioners' star witness- -that he encouraged time-shifting by his viewers. (28)...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT