Mixed Verdict for EMI against MP3tunes.com

A federal district court judge in New York this Monday delivered a mixed-bag opinion in long-running copyright litigation between a number of record companies led by EMI and MP3tunes.com, led by that veteran of music industry litigation, Michael Robertson.

The summary judgment decision affirmed yet again the principle that online content providers have no obligation to proactively “police” their sites or services for their users’ copyright infringements — which has been established in such recent cases as Viacom v. Google (YouTube) and Universal Music Group v. Veoh, at least at the district court level.  As long as service providers respond “expeditiously” to takedown notices under the Digital Millennium Copyright Act (17 U.S.C. § 512) and terminate the accounts of egregious repeat offenders, they aren’t liable for their users’ infringements.

MP3tunes provides what has come to be known as a locker service:  users can upload their music to the service and access it from any Internet-connected device.   That aspect of MP3tunes.com got a clean bill of legal health from Judge William Pauley.

Another feature didn’t, though: the “sideload” feature.  MP3tunes operates a separate website called sideload.com, which lets users search third-party sites that contain free music files (whether legal or not).  Users can search all of those sites with a single search command, select files from them, and copy the files into their MP3tunes lockers.  Sideload.com currently claims access to over 160,000 tracks. MP3tunes responds to takedown notices on such files by removing its links to them from sideload.com search results, but not removing copies of the actual files from users’ lockers.  Judge Pauley didn’t buy MP3tunes’ argument that doing the latter would violate its users’ privacy and personal property; instead he found MP3tunes liable.

Michael Robertson is a wealthy man, having sold his previous music venture, MP3.com, to Universal Music Group for over US $370 Million back in 2001.   Now it seems that he spends his time and effort designing technology products and services that provocatively test the boundaries of both copyright law and copyright owners’ patience.  Robertson started MP3tunes.com in 2005, and in doing so, he invented the idea of “cloud sync” locker services, which are now virtually mandatory checklist items for online music services.  Other vehicles for Robertson’s copyright nose-thumbing include AnywhereCD (buy a CD, get the MP3 for free) and Linspire (Linux-based operating system that runs Windows programs), both now defunct.

As Judge Pauley’s order reveals, MP3tunes.com looks like a site that was designed by Robertson in consultation with copyright law experts with the objective of figuring out just how much they can get away with without record company licenses.  As an example of this, consider a feature in some locker services known as scan and match.  With scan and match, a locker service need not upload a user’s actual files.  Instead, the service scans each file and identifies the music through various means such as examining ID3 tags (metadata in MP3 file headers) and acoustic fingerprinting.  If it has that music in its online catalog already, it skips the upload step and gives the user access to the copy of the file that the service already has.

Scan and match has two big advantages over uploading.  First, uploading could take hours, days, or even weeks depending on the size of the user’s collection.  Second, scan and match eliminates the need for the service to store many files of the same music; it only needs to store a single copy.

Scan and match is a controversial feature; record companies claim that it requires a license from them to cover the “master” files that the service provider hosts.  Apple has a license to implement scan and match for its forthcoming iTunes Match service.  Catch Media has a license for this as well.  Google and Amazon do not.

MP3tunes finesses this issue by actually uploading users’ files but only storing a single copy.  It claims to be able to restore the copy that a user actually uploaded when she wants it — possibly by storing some information about how the uploaded file differs from the file that MP3tunes stores and then using that information to reconstruct the user’s original file on demand.  In other words, MP3tunes has it both ways: it presumably avoids the need for record company licenses (by doing actual uploads instead of scanning and matching) while also avoiding both the storage overhead and the copyright liability of storing multiple copies of the same music on its servers (because each copy is a separate possible infringement, and each infringement carries high financial penalties).  MP3 tunes thus does not actually source its music from record companies; it sources the files from its users. Another service that operates this way is Grooveshark, which has also found itself in legal hot water.

The point is that MP3tunes’ implementation has nothing to do with the user experience and everything to do with treading on the knife-edge of the law.

Similarly, sideload.com is based on the legal principle that because users don’t know whether the music on the third-party sites to which it links is unauthorized or not, the company should not be liable for contributory infringement for those files.  The judge concurred with this.

Robertson’s comments (e.g. on CNet) on the heels of Judge Pauley’s decision reinforce the impression that he is doing this as a professional goad to the music industry: he seems to be much more interested in the decision’s impact on Google and Amazon than on his own site and its 300,000 users.  This decision doesn’t seem to help Google and Amazon much, though: at bottom, it merely reiterates findings from the Veoh and YouTube cases at the district court level.  We won’t know much more about the legal boundaries of online storage services at least until an appeals court renders a decision in one of these cases.

4 comments

  1. Thanks for the analysis Bill. I know it makes for dramatic prose to conjure up this surreptitious scheme with me as the mastermind but it’s inaccurate. Rather the explanation is more straightforward. EMI doesn’t like unlicensed cloud music services so they dreamed up every possible attack the could think of – which is what attorneys are paid to do and will gladly do while charging EMI big hourly wages. And on virtually every issue they lost.

    The storage methodology that MP3tunes uses which EMI made such a commotion about was not invented by MP3tunes. Rather it is the same storage procedures in use by every internet company including Google, Amazon, and Microsoft called deduplication. It’s been standard in the tech industry for more than a decade which is why it is used by every email hosting company, web hosting company, file storage service. Your analysis made it appear that MP3tunes is doing something unique or scandalous when it is in fact not.

    To illustrate how pervasive the technology is we introduced evidence to the court that EMI uses identical deduplication strategy. In addition we pointed out that the court’s own email system uses it as well. Do you think the court is also ‘treading on the knife’?

    You’re also wrong on saying that this ruling doesn’t help Google and Amazon much. Because EMIs attack was so broad attacking every aspect of our case the court’s ruling against them were impactful. Even just one issue like rejecting the claim that pre-1972 are not covered by DMCA immunity dramatically changes the landscape. Surely you know that was the lead issue UMG has complained in their suit against Grooveshark.

  2. Michael,

    Thanks for the comment.

    I’m not sure I buy your argument about de-duping, though. Users upload files that are the same music but not exactly the same files. It seems to me that if you do strict de-duping (as an email system would), you will still end up with a whole lot of files that represent the same music tracks. So therefore you are probably using some sort of music identification scheme (say, ID3 tags plus fingerprinting) to de-dupe, which means that when the user requests her files, she is most likely not getting her exact data back. I seem to recall that you claim the contrary. Either I am wrong (always a possibility) or something doesn’t add up here.

  3. Bill,

    I completely understand your logic and sense you trying to make sense of the facts. Let me give you some more facts to digest.

    MP3tunes does file level deduplication. For this type of deduplication to work the files have to be bit for bit identical. No 99.99% identical but exactly, precisely 100% identical. If even one bit is changed than the storage system doesn’t sees it as a different blob. (It turns out this is rarely the case with music files.)

    With MP3tunes users ALWAYS get the exact same bits out that they put in. No exceptions. We’re not comparing ID3 tags or using fingerprinting as you speculate. We’re not doing any fuzzy matching. The deduplication technology is extremely precise and nothing special is done for music files.

    As I already wrote, this is standard practice in computing and has been for 10 years. Everyone does this and has for many years on every system requiring storage. The same technology is actually built into desktop copies of Microsoft Windows.

    There is a technology which does block level deduplication where parts of files are compared looking for redundancy, but MP3tunes doesn’t do that. Even if we did – it’s not a copyright infringement. Every backup software does block level deduplication so your law firm is using a more aggressive storage scheme than MP3tunes.

    EMI has all of the source code from MP3tunes so they know exactly how it works yet they pursued the ridiculous argument that there was a “master copy” and framed me as an evil genius. The court rightly rejected this conclusion outright.

    So why is EMI pursuing this? Why are making public comments as they did last week that “MP3tunes is built on piracy”? The court clearly stated that “MP3tunes did not promote infringement.” (page 18) Nobody who has ever used MP3tunes can say it’s built on piracy.

    I would suggest the music industry wants to believe the narrative that the digital age – which admittedly has had such an enormous impact on the industry – was caused by someone and that happens to be me: the MP3 guy. And now I’m at it again. This was the essence of your article as well. It’s convenient to blame an individual.

    I’d also add that EMI has outside counsel who gets paid to fight and with the tumultuous ownership of EMI they are left largely unattended. The more they battle the more money they make so they take utterly preposterous positions like when they tell the court that MP3tunes is engaged in 3G (3rd generation) piracy. Huh?

    It does sadden me when thoughtful people like yourself gets caught up in the emotional arguments rather than looking at the core functionality of companies I’ve been involved with over the last decade have actually done. MP3.com unveiled an ingenious service which let you listen to songs if you proved ownership of the CD. That would have extended life of the CD by making it digitally relevant because retailers who implemented this technology saw 20-40% sales boost overnight! Not sure why the industry didn’t want that.

    AnywhereCD gave people MP3 files for any CD they bought – again this would have bolstered CD sales. But emotions overcame rational business analysis and both technologies where shutdown and CD sales tanked. What a shame.

    Here we are again at the doorstep to cloud services. The industry has tried and failed to shut it down. Perhaps a better strategy is to create a real partnership? I’m all for that!

    Thanks for posting my verbose responses.

    — MR

  4. OK, then I stand corrected. If you do strict de-duping, then you are not doing scan and match. You would be saving some storage but not as much as you would if you did scan and match, for the reasons I state — and I’m involved with a music service that is dealing with this issue as well, so I have some working knowledge of this. Anyway, I agree that this is a legally more conservative strategy than what I had thought.

    However, for the record, I think it’s wrong to read into my article the intent to tar you as the single person “responsible for digital.” First of all, that would make about as much sense as calling an individual (at least some mortal being) responsible for gravity or the weather. Second of all, to the contrary, I characterized you as someone who has a proclivity for operating at the cutting edge of copyright law — not only just as other companies (like Google and Amazon) do but also in contrast to the rest of the tech industry.

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