Tuesday, July 01, 2003

7th Circuit: Sony Does Apply, but Willful Ignorance no Protection In a mixed ruling, the 7th Circuit upheld a lower court injunction shutting down Madster prior to trial, but agreed that the Sony Betamax case was controlling precedent. The Court rejected Madster's argument that encryption technology built into the system, which effectively masks the identity of files being shared on-line, relieved Madster of the obligation to block illegal file swapping. "One who, knowingly or strongly suspecting that he is involved in shady dealings, takes steps to ensure that he does not acquire full or exact knowledge of the nature and extent of those dealings, is held to have criminal intent," the Court wrote. Considering the claim for contributory infringement under the Sony doctrine, the Court held that, if detection and prevention of copyright infringement were "highly burdensome" to a service provider, that provider would escape liability for contributory infringement. A copy of the opinion can be found here. Report from C-Net.

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