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Napster May be Held Responsible for Copyright Infringements

Aired February 12, 2001 - 1:06 p.m. ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

NATALIE ALLEN, CNN ANCHOR: When this ruling does come down, what will it mean for the rest of the world? We are going to talk about that with Nick Allard, an attorney specializing in cyber-law. He joins us from Washington to walk us through this.

Nick, as we wait, we should hear any moment. Do you have a feeling of how this is going to go?

NICK ALLARD, ATTORNEY: Not at all, Natalie. You note all the last-minute downloaders; kind of reminds you of the California gold rush, and like the gold rush, the federal courts are the first outpost of law and order; certainly the case here in cyberspace. We'll just have to wait and see how this opinion comes out.

ALLEN: Many people feel, Nick, that the genie is out of the bottle. How do you get it back even if the courts clamp down on Napster -- the technology is out there?

ALLARD: The genie may have his head and torso out of the bottle at this point; it's not quite out of the bottle. But that is a terrific analogy. Professor Paul Goldstein from Stanford likes to point out that once the public gets used to paying for something for free, it's very hard for lawmakers to put that genie back in the bottle, to paraphrase. That's why the creative arts community -- the music recording industry -- is so anxious to have some clear rules established here.

ALLEN: And, where would it go from here, if this were allowed to continue? I've talked with people on this subject who say, what about videos? Are people going to be able to download videos for free? Where could it stop, if this is allowed to continue?

ALLARD: Well, that's what's at issue here. It is really the historic, classic balancing between the creators of original works of art and the users of works of art. We've seen the same fight played out every time a new information technology has been introduced. The interesting -- particularly interesting thing in this particular case, is not only -- not only the novelty of the issues, but the nature of this new technology.

Remember, we're basically applying a copyright law that originated in the Gutenberg-era printing press type of technology. One of the interesting legal arguments was raised was whether the court below Judge Patel, who just joined the bench 20 years ago when I was clerking there, on that particular court. Whether Judge Patel had adequately -- had an opportunity to examine the technology involved: that will be one of the important issues. And you should look for that in the opinion as it comes out.

ALLEN: All right, well, Nick, we think it has just come down, so let's go over to Lou Waters who has been looking at it.

WATERS: Natalie, the appeals court has ruled. And I'm not going to take the headline away from Rusty Dornin who is out in San Francisco.

What's it all about?

RUSTY DORNIN, CNN CORRESPONDENT: Well, Lou, it looks like that the court has upheld at least part of the injunction and sent part of it back to the federal courts. They did say that Napster may be held liable only to the extent that Napster knows of specific copyright infringements, and that they failed to do something about it.

What is unclear now, is whether or not that will shutdown the service or it will -- because only part of the injunction has been upheld. So, we're not clear at this point whether the service will be shutdown or it will be allowed to operate, pending the outcome of the federal judge's decision they're sending it back to -- Lou.

WATERS: All right, Rusty Dornin. Now, Natalie, you have more to chew on with Mr. Allard.

ALLEN: Thanks. Mr. Allard, can you make sense of that? Some wondered whether it'd be a black and white decision or just a gray decision? Is this a gray decision?

ALLARD: Well, my founding partners -- Layman and Watkins (ph) -- would roll over in their graves if I rendered an opinion without even seeing the case. But, from what has been described, it sounds like it is a very questionable remedy in terms of shutting down the uses through Napster.

ALLEN: And...

ALLARD: It sounds like there's -- sounds like and this may be very unfair to the opinion, which I'm sure is very carefully written, but it sounds like a pretty big loophole.

ALLEN: And so, where would it go from here? What's the big picture at this point?

ALLARD: Again, I have to look to the opinion, but, even if there was a clearer resolution of this case, that said either, you win or you lose, Napster -- this would not have been the last word. There would have been appeals, probably to the Supreme Court. Congress would have been involved as it already is.

As importantly, the private parties, the commercial interest would continue to work out. At the top of the story, you indicated there's already been some settlement discussions with some of the parties involved. A lot more to be said after today; this isn't the beginning or the end of Napster by any means.

ALLEN: We thank you so much, Nick Allard. Thanks.

ALLARD: Thank you. Anytime.

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