July 08, 2009

On June 30, Jenner & Block won summary judgment in a New York federal court on behalf of a group of major recording companies in their copyright infringement lawsuit against a commercial USENET server operator.  USENET is a network of online bulletin boards where subscribers may obtain access to a multitude of files posted by other users.

In Arista Records LLC et al. v., Inc., et al, the defendants were alleged to have encouraged use of their service as an alternative to peer-to-peer file-sharing over the Internet in which users downloaded songs illegally and without payment to labels or publishers.  In a 38-page opinion, Judge Harold Baer of the United States District Court, S.D. New York ruled “there can be no dispute that Defendants' services were used overwhelmingly for copyright infringement,” holding that engaged in direct, contributory, and vicarious copyright infringement, and induced others to infringe.

The firm’s team also obtained a broad evidentiary sanctions ruling based on defendants’ destruction of computer data and filed a motion for terminating sanctions based on the defendants’ wiping of employee computers, false responses to discovery requests and their destruction of e-mails that were subject to discovery requests. Judge Baer noted the “wiping” clean of seven hard drives that had belonged to defendants' employees was the “most egregious misconduct alleged,” and, as a sanction, refused to allow Usenet to argue that they were entitled to a “safe harbor” from infringement claims under the Digital Millennium Copyright Act.

According to an article on Billboard Business News, “the opinion will likely be cited as an important precedent in the fight against services that facilitate piracy,” noting that the court’s “most important determination was that copyright defendants can’t claim protection under the U.S. Supreme Court’s landmark 1984 Sony-Betamax decision if they maintain an ‘ongoing relationship’ with their infringing users.”  

The firm’s team was led by Partners Steven B. Fabrizio and Gianni P. Servodidio and included Associates Luke C. Platzer, Duane Pozza and Daniel I. Weiner