RIAA WARNS OF MORE DMCA SUBPOENAS ON MUSIC INFRINGERS

Subpoena issued to Verizon Internet Services last summer -- which ISP refused to comply with and has challenged in U.S. Dist. Court, D.C. -- was first step of what was to be serious nationwide copyright enforcement effort, Donald Verrilli told U.S. Dist. Judge John Bates in oral argument Tues. Bates ruled against Verizon in its challenge to first subpoena but is considering ISP’s request for stay of his order, pending appeal to U.S. Appeals Court, D.C. In meantime, RIAA in Feb. subpoenaed identity of 2nd Verizon customer, prompting carrier to ask to have it quashed.

Internet music piracy “is devastating us,” Verrilli said, and efforts to quash it with lawsuits against Napster, Kazaa and other peer-to-peer (P2P) systems weren’t effective, he said. Now, he, said, RIAA has “no choice but to go after the users.” It’s fair to assume many more DMCA subpoenas will be issued and “very substantial lawsuits” will be filed once courts resolve legality of Sec. 512(h), Verrilli said. RIAA understands need for judicial system to resolve the issues, he said, but record labels lose $100 million every month. That’s why granting Verizon’s request for stay would be “so terribly inappropriate,” he said.

Verizon attorney Andrew McBride said ISP would commit -- for 6-month period during which its challenge was wending its way through legal system -- to notify subscribers of service of DMCA subpoenas seeking their identity. But RIAA wants notice “with a club,” Bates said. McBride said Verizon’s notification to its customers was tougher than RIAA’s. Moreover, he said, every P2P system has mechanism by which RIAA can communicate directly with alleged infringers. Labels can send warning letters to “every Kazaa user in the country,” McBride said.

But Verrilli dismissed Verizon’s offer, calling it “cold comfort to us.” At same time as ISP is sending notices to its subscribers, he said, it’s encouraging the very activities that are causing such harm to RIAA by telling users that free music file sites are likely to have more and better music than subscription services.

Tues.’s oral argument centered on 2 constitutional issues, which Bates said Verizon had downplayed in earlier arguments on first subpoena: (1) Article III requirement that there be a “case or controversy” before federal courts could issue judicial process such as subpoenas. (2) Sec. 512(h) violated First Amendment by being overbroad and failing to safeguard “expressive and associational interest” of Internet users.

McBride disputed RIAA’s view that in issuing DMCA subpoena court clerk was acting similarly to an administrative agency. RIAA intends to use subpoenas to amass large database of potential infringers, making clerks nothing more than copyright police, he said. Question is how far this analogy goes, he said. Must a court take judicial notice of a clerk’s finding that there’s sufficient evidence to issue DMCA subpoena? But Bates pressed McBride on why DMCA subpoenas should be viewed differently from those issued in lawsuits in terms of judicial power brought to bear.

On First Amendment issue, Verizon argued that under RIAA’s interpretation of DMCA, every Internet activity could end up being covered by Sec. 512(h). Are you saying that in most cases Sec. 5129H0 will reach protected speech? Bates asked. “Give me some help” on where to draw line in determining where provision might be substantially overbroad, Bates said. McBride pointed to copyright infringement notification issued on basis of child’s book report on a Harry Potter book -- an example Verizon has raised frequently in arguing that DMCA subpoena is too broad.

But Bates dismissed argument, saying Harry Potter example wasn’t helpful because there was no evidence that subpoena was about to be issued. Constitutional overbreadth argument doesn’t turn on speculation but on evidence, Bates said. He asked McBride whether any evidence on record showed that Verizon would suffer actual harm if its stay request were denied. Verizon’s ability to protect its customers’ privacy will suffer, McBride said. That’s still speculative, Bates responded.

Verizon’s argument that federal courts might never enforce subpoena outside context of pending case or controversy is wrong, Verrilli said. Bates asked “critical question,” Verrilli said: What practical consequences does Sec. 512(h) have for concerns underlying Article III? One such consequence might be that giving that authority to judicial branch could compromise its impartiality and independence, he said. However, he said, that’s only Article III argument Verizon has -- and isn’t anywhere near substantial one.

RIAA’s admission that it intends to solve its piracy problems by issuing millions of subpoenas to Internet users crosses line, McBride said. Clerks now will be “fulltime copyright investigators for RIAA,” he said. Bates said he would take case under advisement.