ABSTRACT

Significant piracy issues began to confound the industry after the Betamax decision, bringing a slew of new digitally based copyright cases to the courtroom. The majority opinion focused on two prongs of the Fair Use test – the nature of the use, and whether the use injured the underlying copyright. The court’s majority ruled that time-shifting was a Fair Use because: the nature of the use was primarily noncommercial; and the use did not injure the value of the underlying copyright. If there had been a Blockbuster store on every corner when the case was decided, renting and selling to lots of people the very movies that were being recorded; the US Supreme Court may have believed that home-taping did injure the value of copyrights. A statistical analysis, admittedly performed by a studio-commissioned statistician but nevertheless cited by the court, showed that 90 percent of the material available to Grokster’s users was protected by copyright.