Appeals Court Limits Use of Subpoenas to ISPs
 
April 5, 2004
 

The United States Court of Appeals for the District of Columbia (the Court) recently issued a major ruling in the case of Recording Industry Association of America Inc. v. Verizon Internet Services Inc., D.C. Cir., No. 03-7015, 12/19/03, which limits the reach of the liberal subpoena provisions of the Digital Millennium Copyright Act of 1998 (DMCA). The ruling comes as a relief to telecommunications giant Verizon Internet Services, Inc., and other Internet Service Providers (ISPs), following the successful attempts of the Recording Industry Association of America, Inc. (RIAA) in the summer of 2002 to subpoena Verizon in order to obtain the identities of alleged peer-to-peer file-sharers who distributed copyrighted music and videos over the Internet.

After watching recording industry revenues significantly decline for several years, the RIAA began pursuing legal action against alleged file-sharers. The RIAA had identified file-sharing, the practice of using third party software such as KaZaA and Morpheus to download from the music libraries of fellow Internet users, as one of the principal sources of the massive declines in revenue in the sale of recorded music. In a well-publicized press release, the RIAA announced that it would not only continue its legal fight against file-sharing sites like KaZaA and Morpheus, but would also begin to collect evidence and prepare to bring claims for copyright infringement against the individuals who illegally trade music online.

The RIAA then turned to the ISPs that provide the distribution platform for Internet-based music file-sharers. In the summer of 2002, the RIAA asked Verizon to identify four of its subscribers accused of sharing copyrighted music so that the RIAA could name them in lawsuits. When Verizon refused, the RIAA relied upon the DMCA’s subpoena provisions under §512(h) to obtain the names of the subscribers. Unlike conventional subpoenas, DMCA subpoenas can be filed prior to any charges of infringement; are not subject to a review by a judge; and require no notice to, or opportunity to be heard by, the alleged infringer.

Verizon filed a motion with the federal district court of the Court to quash the subpoenas based upon two arguments. Verizon argued first that the statute does not authorize the issuance of a subpoena to an ISP that acts solely as a conduit for content that is determined by others. Verizon next argued that the statute is unconstitutional, either because the subpoena failed to involve an actual case before a court, or because the statute failed to sufficiently safeguard an Internet user’s ability to speak and associate anonymously.

After losing two rounds at the trial court, Verizon was compelled to release the requested names. The Court then agreed to hear the matter. It reversed the trial court’s orders to enforce the subpoenas and found for Verizon. In its ruling, the Court did not reach Verizon’s constitutional arguments. The Court acknowledged the RIAA’s concern regarding the widespread infringement of its members’ copyrights and then addressed the issue of whether the subpoena provision of the DMCA “applies to an ISP acting only as a conduit for data transferred between two Internet users, such as persons … sharing P2P files.”

Verizon maintained that the DCMA provision did not authorize the issuance of a subpoena to an ISP that transmits, but does not store on its servers, infringing material. The RIAA, on the other hand, asserted that the statute authorized the issuance of a subpoena to an ISP “without regard to whether the ISP is acting as a conduit for user-directed communications.”

The Court found, however, that Congress, in drafting and enacting the DMCA, did not contemplate that Internet users might one day be able to directly exchange files containing copyrighted materials like songs or videos. Because Congress did not foresee this use of peer-to-peer file sharing, Congress did not foresee or anticipate the application of the subpoena provision to ISPs in the peer-to-peer file-sharing context. The text of the statute, the Court held, requires that “the subpoena power … applies only to ISPs engaged in storing copyrighted material and not to those engaged solely in transmitting it on behalf of others” (emphasis added). The subpoena provision of the statute, therefore, cannot be used to seek the identities of alleged peer-to-peer file-sharers from ISPs. In other words, in order to pursue legal action against peer-to-peer copyright infringers, the RIAA must now petition courts for permission to issue subpoenas to ISPs in order to obtain the personal information of ISP subscribers.

The court stood unmoved by the RIAA’s attempt to identify file-sharing as a prime suspect in the music industry’s loss of billions of dollars in revenue, asserting that the statute simply did not function in such a way as to lend the music industry this particular tool in identifying individual copyright infringers. The only remedy available to the RIAA was congressional action – “[t]he plight of copyright holders must be addressed in the first instance by the Congress.”

For the music industry, the loss of this readily available subpoena power may represent one lost battle, but file sharers and ISPs alike can be sure that RIAA will continue its war against music piracy.

For more information, e-mail Shawn Johnson at shawn.johnson@hklaw.com or call toll free, 1-888-688-8500.