Sony Corp v. Universal City Studios, 464 U.S. 417 (1984) (Docket Number: 81-1687), is also known as the Betamax case. The Supreme Court of the United States found that the making of individual copies of complete television shows for home use is considered fair use, and that the manufacture of devices, such as Betamax or VCRs, to facilitate that is legal. Arguments were presented on January 18, 1983, and re-presented on October 3, 1983. The decision was announced on January 17, 1984.

Facts

Sony developed Betamax, a video tape recording format (VHS would later outcompete Betamax). Universal sued Sony, alleging that because they (Sony/Betamax) were manufacturing a device that could potentially be used for copyright infringement, they were thus liable for any infringement that did occur.

Prior court history

A District Court had previously held that noncommercial home use recording was considered fair use, that access to free public information is a First Amendment public interest served by this use and had ruled in favor of Sony. However, this ruling was reversed by the United States Court of Appeals for the Ninth Circuit, which held Sony liable for contributory infringement. The court also held that the Betamax was not a staple article because its main purpose was copying. It went on to suggest damages, injunction and compulsory licenses in lieu of other relief.

Supreme Court holding

The Supreme Court ruled 5-4 in favor of Sony, with Stevens, Burger, Brennan, O'Connor, and White in agreement, and Marshall, Powell, Rehnquist, and Blackmun dissenting. The court held, among other things, that "The sale of the VTR's [video tape recorders] to the general public does not constitute contributory infringement of respondents' copyrights."

Majority opinion

Justice Stevens wrote the majority opinion. On the question of whether Sony could be described as "contributing" to copyright infringement, he wrote:

[There must be] a balance between a copyright holder's legitimate demand for effective - not merely symbolic - protection of the statutory monopoly, and the rights of others freely to engage in substantially unrelated areas of commerce. Accordingly, 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....

The question is thus whether the Betamax is capable of commercially significant noninfringing uses ... one potential use of the Betamax plainly satisfies this standard, however it is understood: private, noncommercial time-shifting in the home. It does so both (A) because respondents have no right to prevent other copyright holders from authorizing it for their programs, and (B) because the District Court's factual findings reveal that even the unauthorized home time-shifting of respondents' programs is legitimate fair use....

If there are millions of owners of VTR's who make copies of televised sports events, religious broadcasts, and educational programs ... and if the proprietors of those programs welcome the practice, the business of supplying the equipment that makes such copying feasible should not be stifled simply because the equipment is used by some individuals to make unauthorized reproductions of respondents' works....

When one considers the nature of a televised copyrighted audiovisual work ... and that time-shifting merely enables a viewer to see such a work which he had been invited to witness in its entirety free of charge, the fact ... that the entire work is reproduced ... does not have its ordinary effect of militating against a finding of fair use.

Combined with noncommercial, nonprofit nature of time-shifting, he concluded that it was indeed a fair use.

Dissenting opinion

Justice Blackmun wrote the dissent. With regard to the issue of unauthorized time-shifting, he wrote:

Section 106 of the 1976 [Copyright Revision] Act grants the owner of a copyright a variety of exclusive rights in the copyrighted work, including ... the right "to reproduce the copyrighted work in copies or phonorecords." ... Although the word "copies" is in the plural in 106(1), there can be no question that under the Act the making of even a single unauthorized copy is prohibited....

The 1976 Act and its accompanying Reports specify in some detail the situations in which a single copy of a copyrighted work may be made without infringement concerns ... But neither the statute nor its legislative history suggests any intent to create a general exemption for a single copy made for personal or private use....

Fair use may be found when a work is used "for purposes such as criticism, comment, news reporting, teaching, . . . scholarship, or research." ... other examples may be found in the case law. Each of these uses, however, reflects a common theme: each is a productive use, resulting in some added benefit to the public beyond that produced by the first author's work....

It may be that an injunction prohibiting the sale of VTR's would harm the interests of copyright holders who have no objection to others making copies of their programs. But such concerns should and would be taken into account in fashioning an appropriate remedy once liability has been found. Remedies may well be available that would not interfere with authorized time-shifting at all ... Sony may be able, for example, to build a VTR that enables broadcasters to scramble the signal of individual programs and "jam" the unauthorized recording of them....

The Court explains that a manufacturer of a product is not liable for contributory infringement as long as the product is "capable of substantial noninfringing uses" ... Such a definition essentially eviscerates the concept of contributory infringement. Only the most unimaginative manufacturer would be unable to demonstrate that an image-duplicating product is "capable" of substantial noninfringing uses. Surely Congress desired to prevent the sale of products that are used almost exclusively to infringe copyrights.

Subsequent history

Many of the same points of law that were litigated in this case are still being argued in various cases, particularly in light of recent peer-to-peer lawsuits; for example, in August 2004, in the case of Metro-Goldwyn-Mayer v. Grokster [1] (http://techlawadvisor.com/docs/mgm-grokster.html), the Ninth Circuit Court of Appeals ruled in Grokster's favour due to its "substantial noninfringing uses".

The DMCA modified the law that the Sony decision was based upon in several ways, and new interpretations are constantly being handed down.

External links

• Complete ruling (http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=us&vol=464&invol=417)
• Oyez summary (http://www.oyez.org/oyez/resource/case/768/)

The Supreme Court will hear Grokster oral arguments on March 29, 2005 according to EFF (http://www.eff.org/news/archives/2005_01.php#002221), which is serving as defense council in the case.