Wednesday, June 29, 2005

Grokster: Porting Inducement from Patent to Copyright -- A Buggy Application

In MGM v. Grokster, the Supreme Court ports the application of inducement from the patent platform to the copyright platform. In the process, they expand its functions, distort its features, and add a lot of bugs. The new application has all the elegance of the worst application ever written -- MacWindows.

Grokster starts out just fine with its discussion of what amounts to "inducement" based on established patent law (pp. 17-18). The opinion runs off-track, however, when it assesses the sufficiency of the plaintiff's evidence below to survive summary judgment (pp. 21-22). The opinion outlines three categories of "evidence of intent" to induce infringement.

The first is advertising infringing uses to an identifiable market for infringing uses. That's fine -- that is inducement, plain and simple, and that's all the evidence you need. If you've got it, case closed.

My problem is with the second and third. The failure or refusal to implement filtering tools might, as the Court says, be evidence of "intentional facilitation," but it is not evidence of intentional inducement. If I leave my keys in the car every time I parked it that would be evidence of intentional facilitation, but not evidence of intentional inducement. Similarly, evidence that Streamast and Grokster make money by selling ads based on the volume of mostly infringing uses may prove that defendants intended the infringing use, but it does not prove intentional inducement.

The Court's whole discussion of "intent" is misbegotten. The only thing that has to be intentional is the inducement. See Manville Sales, 917 F.2d at 553 ("The plaintiff has the burden of showing that the alleged infringer’s actions induced infringing acts and that he knew or should have known his actions would induce actual infringement."); Warner-Lambert, 316 F.3d at 1363 ("To succeed on this theory, a plaintiff must prove that the defendants’ ‘actions induced infringing acts and that [they] knew or should have known [their] actions would induce actual infringement.’"

In short, it is irrelevant that the defendant intended to facilitate infringement; and it is irrelevant that the defendant intended to make money from infringement. The only thing that is relevant is whether the defendant intended to induce infringement; and the only kind of unintentional inducement is inducement to do something that you didn't know was infringement, e.g. an intentional inducement on the mistaken belief that the alleged infringement was fair use. The Federal Circuit Bar Assoc. Model Patent Jury Instructions make this clear:


A person induces patent infringement if he or she purposefully causes, urges or encourages another to infringe a patent. Inducing infringement cannot occur unintentionally. This is different from direct infringement, which, as I've just told you, can occur unintentionally. In order to prove inducement, the patent owner must prove that it is more probable than not that the accused inducer knew of the patent and encouraged or instructed another person to [use a product or perform a process] in a manner that infringes the patent. The patent owner must also prove that it is more probable than not that the other person infringed the patent. A person can be an inducer even if he or she thought that what he or she was encouraging or instructing the other person to do was not an infringement.

[Plaintiff] asserts that [defendant] induced patent infringement.

[Plaintiff] must prove four things by the more probable than not standard:

First, [defendant] encouraged or instructed another person how to [use a product or perform a process] in a manner that you, the jury, find infringes the ___ patent claims.

Second, [defendant] knew of the ___ patent.

Third, [defendant] knew or should have known that his or her encouragement or instructions would likely result in the other person doing that which you find to be an infringement of the ___ patent.

Fourth, the other person infringed the ___ patent.

If, and only if, you are persuaded of each of these four things may you find that [defendant] induced patent infringement.

If I was a judge, I would sustain a relevancy objection to evidence that the defendant permits or profits from infringement. It is clearly prejudicial -- it proves greed; but it does not "make any fact that is of consequence to the determination of the action more probable or less probable." FRE 401.

This is important because the Court is doing more here than simply confusing the issues. It is transforming the law of inducement while pretending only to port its functions and features from the patent platform to the copyright platform. The relevance of evidence that defendants permit and profit from millions of infringing uses simply assumes that all of the infringements were induced by the defendant. I don't remember who told me I could get free music with P2P software, but I suspect it was CNET.COM. Even if 90% of the P2P uses are infringing, something less than .0001% of the infringements were induced by anybody who had anything to do with Streamcast or Grokster.

The Court's theory of inducement holds defendants liable, not just for the infringers the defendants encouraged, but for all the infringers anyone encouraged, as well as the infringers who needed no encouragement at all. This kind of inducement can't be enjoined because it can't be stopped. This kind of inducement holds Grokster liable for inducement because my kids learned they could steal music from their father's lecture about why it's wrong. In fact, it seems clear that the Court's evidence of intentional inducement is built on a foundation of unintended inducements. The defendants are not being held liable for inducement; they are being held liable for a principle of economics -- network effects.

This is too long already, but I can't stop without adding that this is more proof of my pet peeve -- every Supreme Court justice should have at least one law clerk who has twenty years of litigation experience instead of law review editor on his resume.