In re Aimster Copyright Litigation - Opinion by J. Posner

John Deep — Sat, 22 Apr 2006 15:52:04 -0500

IN RE: AIMSTER COPYRIGHT LITIGATION. APPEAL OF: JOHN DEEP, Defendant.

No. 02-4125

UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT

334 F.3d 643; 2003 U.S. App. LEXIS 13229; 67 U.S.P.Q.2D (BNA) 1233; Copy. L. Rep. (CCH) P28,630

June 4, 2003, Argued

June 30, 2003, Decided

>SUBSEQUENT HISTORY: US Supreme Court certiorari denied by Deep v. Recording Indus. Ass'n of Am., Inc., 540 U.S. 1107, 157 L. Ed. 2d 893, 124 S. Ct. 1069, 2004 U.S. LEXIS 91 (U.S., 2004)

Aimster Litigation: Background

John Deep — Fri, 21 Apr 2006 21:28:40 -0500

IN THE SUPREME COURT OF THE UNITED STATES
Date: October 28, 2003

Statement
John Deep, Petitioner, studied classical music performance at Harvard (B.A. '79), and is an author of seven books and of more than a dozen CD-ROM software products, whose work merging audio and video with e-books for education received the Smithsonian Award for Innovation in 1998, App. 121a; and also, an innovator featured in the Sunday Washington Post, Feb. 25, 2001, p. A1, App. 106a, and named one of Time Magazine's Innovators of the Year in Music in 2001,Time Magazine, May 28, 2001, P. 73, for his creation of Aimster; and recently, a provider of Aimster Internet service, incorporated as a venture for online retail of music and movies, with various co-shareholders including First Albany Corp., App. 111a, and TransWorld Entertainment, Corp., one of the largest specialty retailers of compact discs, prerecorded audio cassettes, prerecorded videocassettes, digital versatile discs ("DVDs") and related products in the United States, with sales of $1.41 billion. TransWorld Entertainment Corp. Annual Report, 10K, May 4, 2001 at "Business: General, Branding"

Petitioner, whom the court below called "Aimster," App. 2a, developed the Internet service at issue ("Aimster Internet service") in August 2000 and entered into an online retail venture with TransWorld Entertainment in late January 2001, see App 74-75a, which included corporations BuddyUSA, Inc. and AbovePeer, Inc. (the "Corporations"), App 26a.

Petitioner prays that in the present case this Court may hear other authors, innovators and providers similarly situated to Petitioner.

Respondents are the Recording Industry Association of America, Inc., et al., numerous plaintiffs, who among them, as the court below said, appear to own most subsisting copyrights on American popular music, App. 2a.

District Court Decision. Petitioner requested discovery of Respondents' anti-competitive actions and again requested an evidentiary hearing. But on July 18, the district court denied Petitioner the evidentiary hearing, App. 43a, and on September 4, 2002, granted an injunction and ordered Respondents to draft the injunction, App. 81a, and then adopted Respondents' language for a broad injunction verbatim. App. 82a.

Attorney Withdraws. Petitioner did not disclose details of his venture with TransWorld Entertainment until November 2002, when the district court granted his attorney's motion to withdraw (which cited potential conflict of interest), after denying the attorney's first motion. But once this key evidence came to light, certain speculative statements of the district court were proven to be plain error, namely: (1) "At issue is a service whose very raison d'etre appears to be the facilitation of and contribution to copyright infringement on a massive scale." App. 24a. (2) "Defendants manage to do everything but actually steal the music off the store shelf and hand it to Aimster's users" App. 53a

Instead, Petitioner proved that he did everything solely to sell music from the shelves of his co-shareholder TransWorld, his very raison d'etre to promote the online retail venture of music and movies, as a review of the record shows. Indeed, Petitioner submitted the actual TransWorld exclusive licensing agreement, (in which TransWorld is referrd to as the "Purchaser") and some important provisions are:

Scope:Aimster will develop a customized version of the software, and the Content is defined as "music, movies and videogames."
Absolute Right to Permit File-Sharing:File-sharing "shall not be deemed to violate the Purchaser's exclusive rights."
Right to Use and Exclusivity:TransWorld will have the exclusive right both to sell Content and to "exclusive hosting."

Source: First Report of Compliance, November 12, 2002. Fortunately, on appeal the court below had before it a clear record of Petitioner's relationship with TransWorld, and did not appear to adopt the most egregious of the district court's plain error. Of course, this Court would have the same clear record for review.

Appeal. Petitioner provided Internet service to the general public, a number estimated in the millions. App. 107a. But the broad injunction granted had the effect of shutting down the Aimster Internet service entirely, App. 2a. On November 26, even without counsel, Petitioner appealed pro se, and requested an emergency stay of the unprecedented overbroadness of the injunction. However, the court below denied the stay and affirmed the grant of injunction in its opinion published on June 30, 2003, In re Aimster, 334 F.3d 643 ("In re Aimster").

Music Download Lawsuit - John Deep v. RIAA, Boies, et al. - Aimster

In re Aimster Copyright Litigation - Opinion by J. Posner

Aimster Litigation: Background