Sony Corp. v. Universal City Studios
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''Sony Corp. of America v. Universal City Studios, Inc.'', 464 U.S. 417 (1984), also known as the “Betamax case”, is a decision by the
Supreme Court of the United States The Supreme Court of the United States (SCOTUS) is the highest court in the federal judiciary of the United States. It has ultimate appellate jurisdiction over all U.S. federal court cases, and over state court cases that involve a point o ...
which ruled that the making of individual copies of complete
television Television, sometimes shortened to TV, is a telecommunication medium for transmitting moving images and sound. The term can refer to a television set, or the medium of television transmission. Television is a mass medium for advertisin ...
shows for purposes of time shifting does not constitute
copyright infringement Copyright infringement (at times referred to as piracy) is the use of works protected by copyright without permission for a usage where such permission is required, thereby infringing certain exclusive rights granted to the copyright holder, s ...
, but is fair use.. The Court also ruled that the manufacturers of home video recording devices, such as
Betamax Betamax (also known as Beta, as in its logo) is a consumer-level analog recording and cassette format of magnetic tape for video, commonly known as a video cassette recorder. It was developed by Sony and was released in Japan on May 10, 1975, ...
or other
VCR A videocassette recorder (VCR) or video recorder is an electromechanical device that records analog audio and analog video from broadcast television or other source on a removable, magnetic tape videocassette, and can play back the recording. ...
s (referred to as
VTR A video tape recorder (VTR) is a tape recorder designed to record and playback video and audio material from magnetic tape. The early VTRs were open-reel devices that record on individual reels of 2-inch-wide (5.08 cm) tape. They were us ...
s in the case), cannot be liable for contributory infringement. The case was a boon to the home video market, as it created a legal safe haven for the technology. The broader legal consequence of the Supreme Court's decision was its establishment of a general test for determining whether a device with copying or recording capabilities ran afoul of
copyright A copyright is a type of intellectual property that gives its owner the exclusive right to copy, distribute, adapt, display, and perform a creative work, usually for a limited time. The creative work may be in a literary, artistic, education ...
law. This test has created some interpretative challenges to courts in applying the case to more recent file sharing technologies available for use on home computers and over the
Internet The Internet (or internet) is the global system of interconnected computer networks that uses the Internet protocol suite (TCP/IP) to communicate between networks and devices. It is a '' network of networks'' that consists of private, pub ...
.


Background

In the 1970s,
Sony , commonly stylized as SONY, is a Japanese multinational conglomerate corporation headquartered in Minato, Tokyo, Japan. As a major technology company, it operates as one of the world's largest manufacturers of consumer and professional ...
developed the
Betamax Betamax (also known as Beta, as in its logo) is a consumer-level analog recording and cassette format of magnetic tape for video, commonly known as a video cassette recorder. It was developed by Sony and was released in Japan on May 10, 1975, ...
video tape recording format.
Universal Studios Universal Pictures (legally Universal City Studios LLC, also known as Universal Studios, or simply Universal; common metonym: Uni, and formerly named Universal Film Manufacturing Company and Universal-International Pictures Inc.) is an Ameri ...
and the Walt Disney Company were among the entertainment companies who were wary of this development, but were also aware that the U.S. Congress was in the final stages of a major revision of copyright law and would likely be hesitant to undertake any new protections for the film industry. The companies therefore opted to sue Sony and its distributors in the U.S. District Court for the Central District of California in 1976, alleging that because Sony was manufacturing a device that could be used for
copyright infringement Copyright infringement (at times referred to as piracy) is the use of works protected by copyright without permission for a usage where such permission is required, thereby infringing certain exclusive rights granted to the copyright holder, s ...
, they were thus liable for any infringement committed by purchasers of the device. The complaint additionally included an unfair competition claim under the Lanham Act, but this was dismissed early in the course of the lawsuit. Two years later, the District Court ruled for Sony, on the basis that noncommercial home use recording was considered fair use, and that access to free public information is a
First Amendment First or 1st is the ordinal form of the number one (#1). First or 1st may also refer to: *World record, specifically the first instance of a particular achievement Arts and media Music * 1$T, American rapper, singer-songwriter, DJ, and rec ...
public interest served by this use. However, this ruling was reversed in part by the Ninth Circuit Court, which held Sony liable for contributory infringement. That court also held that the main purpose of Betamax was copying. The circuit court went on to suggest damages,
injunctive relief An injunction is a legal and equitable remedy in the form of a special court order that compels a party to do or refrain from specific acts. ("The court of appeals ... has exclusive jurisdiction to enjoin, set aside, suspend (in whole or in par ...
, and compulsory licenses in lieu of other relief.


Supreme Court ruling


Majority opinion

The Supreme Court ruled 5-4 to reverse the Ninth Circuit in favor of Sony. The ruling was largely focused on whether the technology in question had significant non-infringing uses, and that the plaintiffs were unable to prove otherwise. On the question of whether Sony could be described as "contributing" to copyright infringement, the Court stated: :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 broadcasting, time shifting is the recording of programming to a storage medium to be viewed or listened to after the live broadcasting. Typically, this refers to TV programming but it can also refer to radio shows via podcasts. In recent year ...
in the home. .. en 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 the noncommercial, nonprofit nature of time-shifting, the Court concluded that it was indeed a fair use. Children's television personality
Mr. Rogers Fred McFeely Rogers (March 20, 1928 – February 27, 2003), commonly known as Mister Rogers, was an American television host, author, producer, and Presbyterian minister. He was the creator, showrunner, and host of the preschool television se ...
' testimony supporting the manufacturers of VCRs before the District Court was taken into consideration for the decision. The Court stated that his views were a notable piece of evidence "that many elevisionproducers are willing to allow private time-shifting to continue" and even quoted his testimony in a footnote.


Dissenting opinion

Justice
Harry Blackmun Harry Andrew Blackmun (November 12, 1908 – March 4, 1999) was an American lawyer and jurist who served as an Associate Justice of the Supreme Court of the United States from 1970 to 1994. Appointed by Republican President Richard Nixon, Blac ...
dissented, joined by Justices Marshall,
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, and
Rehnquist William Hubbs Rehnquist ( ; October 1, 1924 – September 3, 2005) was an American attorney and jurist who served on the U.S. Supreme Court for 33 years, first as an associate justice from 1972 to 1986 and then as the 16th chief justice from 1 ...
. With regard to the issue of unauthorized time-shifting, Blackmun wrote: "Section 106 of the 1976 opyrightAct 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 107(1), there can be no question that under the Act the making of even a single unauthorized copy is prohibited."


Subsequent developments

Immediately after their loss at the Supreme Court, the entertainment companies lobbied Congress to pass legislation that would protect them from the effects of home copying. However, in the eight years that had passed since the suit was initially filed, the use of home recording devices had become so widespread that Congress was not prepared to take any action detrimental to the significant population of VCR owners. The film industry lobbied Congress to impose a small statutory royalty on the sale of blank videotapes, but Congress would not do so, noting the increased profits for film studios in the home video rental and sales market. Rather than destroying film studios, videotape sales became increasingly important to their revenue. The press discussed the VCR "and the viewing habits it has engendered — the Saturday night trip down to the tape rental store to pick out for a couple of bucks the movie you want to see when you want to see it". Film studios opened new divisions to produce prerecorded tapes, and by 1985 home video sales were about the same as box office revenue; the
Associated Press The Associated Press (AP) is an American non-profit news agency headquartered in New York City. Founded in 1846, it operates as a cooperative, unincorporated association. It produces news reports that are distributed to its members, U.S. newspa ...
reported that "because of the VCR, even a bad movie can make money". Although the VCR received blame for a 25% decline in the summer 1985 box office compared to 1984's, and was blamed for failing movie theaters, by 1987 it was credited with contributing to a record-high box office season, as videotapes' popularity encouraged consumers' interest in films and watching them in theaters. Cable movie channels worried about VCRs affecting subscriptions, but began to offer more films for owners who wanted to build a home library, even encouraging time shifting by broadcasting the movies during the night so VCRs could record them while their owners slept. In 1989 Sony purchased
Columbia Pictures Columbia Pictures Industries, Inc. is an American film production studio that is a member of the Sony Pictures Motion Picture Group, a division of Sony Pictures Entertainment, which is one of the Big Five studios and a subsidiary of the mu ...
and became owner of its own Hollywood studio. By 1995 more than half of Hollywood's American revenue came from home video compared to less than a quarter from movie theaters. ''Forbes'' wrote in 2001 that the VCR was no longer "arguably believed to be the death knell of the movie business. Instead it became arguably its savior" because consumers preferred buying or renting films to recording their own onto blank tapes.
Pamela Samuelson Pamela Samuelson is the Richard M. Sherman '74 Distinguished Professor of Law and Information Management at the University of California, Berkeley with a joint appointment in the UC Berkeley School of Information and Boalt Hall, the School of Law. ...
has remarked that "the Sony decision is the most significant legacy of Justice Stevens in the field of intellectual property law and its significance is likely to continue in mediating disputes between copyright industries and creative information technology developers and users of information technology." The Digital Millennium Copyright Act of 1998 modified the aspects of copyright law that informed the ''Sony'' decision in several ways, and new interpretations are still being handed down. 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 Peer-to-peer (P2P) computing or networking is a distributed application architecture that partitions tasks or workloads between peers. Peers are equally privileged, equipotent participants in the network. They are said to form a peer-to-peer n ...
lawsuits; for example, in '' A&M Records, Inc. v. Napster, Inc.'' in 2001, the Ninth Circuit Court of Appeals rejected a fair use " space shifting" argument raised as an analogy to the time-shifting argument that prevailed in ''Sony''. The Ninth Circuit further distinguished the cases because the ''Napster'' defendants operated a system that allowed them to monitor and control the potentially infringing activities of its users. In ''
MGM Studios, Inc. v. Grokster, Ltd. ''MGM Studios, Inc. v. Grokster, Ltd.'', 545 U.S. 913 (2005), is a United States Supreme Court decision in which the Court ruled unanimously that the defendants, peer-to-peer file sharing companies Grokster and Streamcast (maker of Morpheus), cou ...
'' in 2005, the Supreme Court extended this analysis to advanced video file-sharing systems..


References


Further reading

* * * * *James Lardner, ''Fast Forward: Hollywood, the Japanese, and the VCR Wars'' (1987) (book reviewing the economy and case) * *


External links

* * {{DEFAULTSORT:Sony Corp. Of America V. Universal City Studios, Inc. United States Supreme Court cases United States Supreme Court cases of the Burger Court United States copyright case law Universal Pictures litigation Sony litigation 1984 in United States case law Fair use case law Media case law Disney litigation