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TO SHARE OR NOT TO SHARE: FILE SHARING ON THE INTERNET - FRANK JOFFE

The downloading and sharing of video and music files on the Internet is commonplace, but is not always lawful. Websites such as Napster, which allowed the free downloading of music files, have been forced to change their methods of doing business. The popular Apple itunes music site also charges for each download and presumably pays a royalty to the owner of copyright in the particular musical work downloaded. There are now also local South African pay-per-download music sites.

The main field of law dealing with the downloading and sharing of video and music files is that of copyright. However, South Africa has been slow in adapting to worldwide developments in the field of Information Technology. The Copyright Act provides for the protection of certain works. These include musical works, cinematograph films and sound recordings. Videos and music tracks would fall within these categories. The unauthorized copying of a copyright work amounts to copyright infringement. The Act does provide certain exceptions to infringement. In the case of musical works, these may be copied for the personal or private use of the person using the work, provided that this is consistent with fair dealing.

The downloading of a music track or a video necessarily involves the copying of the relevant work. So does the sharing of the music or video file with a friend. Clearly, the downloading of a music track or video without the authorization of the copyright owner is an act of copyright infringement. A further act of infringement takes place whenever the file is shared with another person. How do we know when the copyright owner has authorized the copying of the work? Well, this should be made explicit on the relevant website from which the work is downloaded. However, a good indication that the owner has given consent is that a charge is made for downloading the material. If the download is free, it is probably unlawful. Even if the download has been paid for, this does not imply that the file may be freely shared with others.

South African law also recognises that it may be unlawful to contribute to the infringement of a right such as copyright, by aiding or abetting another person to commit an act of infringement. This raises the question of potential liability for the providers of software for ripping music and video files and for sharing these files, either on a peer-to-peer basis on a one-to-many basis. There are no decided cases in South Africa on the liability for copyright infringement of such a software provider. In the USA the issue was decided in the well-known Grokster case. In that case, Grokster was held to have distributed file sharing software with the object of promoting its use to infringe copyright. There was clear evidence of infringement of copyright by the downloading of music files “on a gigantic scale” and the court found that it may be impossible to enforce rights in the protected work effectively against all direct infringers so that the only practical alternative is to act against the device’s distributor for secondary liability. Grokster had profited from the direct infringement by the potential increase in advertising revenue and had made no attempt (other than some insignificant copyright infringement warning notices) to prevent infringement taking place. It had in fact broadcast a message designed to stimulate others to commit violations.

In Australia, a court faced with similar facts came to a similar conclusion. The court found against the operator of the Kazaa file sharing system, which is a free peer-to-peer file sharing system on the basis that the operator had “authorized” the infringing acts of copyright infringement. Confusingly, the Dutch Supreme Court took a contrary view and ruled that the original providers of the Kazaa file sharing service were not acting illegally in making their software publicly available.

In both the US and Australian cases infringement of copyright by file sharing had taken place on a very large scale. The provider of the software was held to have had reason to believe that such copyright infringement was taking place. The provision of warnings to avoid copyright infringement was not held to go far enough to avoid liability. In both the Grokster and Kazaa cases, the courts found that the infringer had actively advertised their product and had virtually encouraged the infringement of copyright by the sharing of protected files. In both cases, it was found that there were means available to the software provider to at least limit the extent of copyright infringement and that these means had not been implemented. In both cases, the infringer had benefited commercially from increased advertising revenue.

The tendency of the US and Australian courts to find in favour of copyright holders in circumstances where means have been provided for the infringement of copyright by file sharing on a very substantial scale, will most probably be followed by South African courts.

FRANK JOFFE

BOWMAN GILFILLAN INC.

30 March 2006.

Friday, March 31, 2006