Grooveshark In Retrospect

Grooveshark Logo

Grooveshark was one of my favorite streaming apps when the company was still in its “hey-day”. I remember its simple interface being packed with many features and I could find and stream any song in the world. I used it to make playlists for my road-trips, jam sessions, workouts etc and I was even a paying customer. And then sometime a few years back the service was shutdown with a strange email from their CEO conveying an apology for Copyright Infringement. I have been a performing musician for a few years now and much like other musicians, I too was mostly ignorant of the “internals” of the music industry. It is only when I decided to get a Master’s Degree in Music Business and my Law class has helped me understand topics like Copyrights and Intellectual Property. It is then when I had decided to look deeper into why Grooveshark was shutdown and maybe that I could now understand better with my newfound knowledge. And here goes my findings and analysis of the case ‘UMG Recording, Inc. v. Escape Media Group’…

Summary

“Grooveshark”, an online music sharing platform, was finally taken down by the Music Industry ( specifically, the recording industry ), not because it was hosting millions of unlicensed songs but because its employees were uploading the songs to the platforms, thereby being liable direct and secondary copyright infringement.

Timeline

Following is a brief timeline of key events that led to the case and eventually the ruling

• 2006 — Escape was founded.
• Early 2007 — Escape directed its employees to obtain the content ( music ) to launch Grooveshark and to upload or “seed” these files.
• Mid 2007 — Engaged with UMG, Sony and Warner in licensing discussions. However, they were denied licenses.
• June 2007 — Escape began to use central servers, which is referred to as their “cache”. Escape designed a proprietary software named “SharkByte”, that automatically copies unique music files of its users to these central servers. All the user uploads were stored in a table named “UsersFiles”.
• August 2007 — Escape instructs its employees again to “cache” more songs to their library.
• Early 2008 — Escape has 1 million digital music files.
• April 2008 — Launch of the streaming client, “GrooveShark Lite”.
• October 2008 — Discontinued the P2P network to focus solely on the streaming client
• Late 2008 — Plaintiffs’ trade association, the Recording Industry of America, forwarded infringement notices to Amazon.com, the web hosting service that Grooveshark used.
• May 2009 — EMI sues Grooveshark.
• Mid 2009 — Escape received several Digital Millennium Copyright Act ( DMCA ) takedown requests from copyright holders. Greenberg received over 29 of these notifications.
• October 2009 — EMI withdraws lawsuit and licenses Grooveshark for its catalog
• January 2010 — UMG initiated an action against Escape in New York state court ( “State Court Action” ) for common law copyright infringement of UMG’s recordings that we created before 1972 and thus, are not subject to federal law.
• August 2010 — Apple pulled the Grooveshark app from the app market.
• February 2011 — Escape produced an upload report to plaintiffs, revealing 27 million uploads.
• April 2011 — Google pulled the Grooveshark app from the Android market.
• August 2011 — Escape provided UMG with an Upload Report that detailed employee uploads. This is the first time UMG becomes aware of Escape’s employees uploading plaintiff’s copyright protected sound recordings onto Grooveshark.
• September 2011 — Grooveshark signs licensing deals with Independent label Sun Records.
• November 2011 — UMG filed the instant action. The claim only relates to the uploading of infringing files by Escape’s employees and officers. UMG sued for $15 billion ( this number also equates to the then entire recording industry ).
• November 2011 — UMG/Sony initiate talks about a controversial buyout of EMI
• December 2011 — Remaining plaintiffs join the case.
• January 2012 — EMI sues Grooveshark for non-payment of royalties
• July 2012 — State Court Action results in favor of Grooveshark. Concluding that all the songs made before 1972 fell under DMCA’s safe harbor provision. Judge cited a previous case Capitol Records Inc. vs. MP3Tunes.
• September 2012 — The EMI acquisition deal is approved in USA and Europe for $1.2 Billion.
• April 2013 — New York State Supreme court reversed the lower state court’s action, in favor of UMG. Google reacts and starts censoring “grooveshark” on search results.
• February 2014 — Plaintiff filed their motion for summary for summary judgement and their motion of sanctions for spoliation of evidence. ( It was established that upload logs, source code and content were deleted )
• September 2014 — The court rules in favour of the Plaintiffs on all causes of action
• April 2015 — Official shutdown on Grooveshark platform.
• May 2015 — Numerous clones of Grooveshark sprout back from fans in retaliation, only to be shut off in a few days.
• July 2015 — Joshua Greenberg, one of the defendants, was found to be dead where the autopsy revealed the cause of death to be “undetermined” (Conspiracy much!? Just kiddin’).

Ruling

The court has ruled in favor of the plaintiffs on the claims that the defendants Samuel Tarantino and Joshua Greenberg are direct infringers of plaintiffs’ copyrighted works due to employee uploads that have occurred. The court did not find the defendants guilty of hosting unlicensed copies of copyrighted work as they are protected under DMCA’s ‘safe harbor’.

A Deeper Analysis of the Infringement and Claims

The most important reason why the court ruled in favour of the plaintiffs is due to a few company wide emails that were sent by Samuel ( one of the defendants ) in its early days. Samuel was 22 years old

“…. Please share as much music as possible from outside the office, and leave your computers on whenever you can. This initial content is what will help to get our network started — it’s very important that we all help out! If you have available hard drive space on your computer, I strongly encourage you to fill it with any music you can find. Download as many MP3’s as possible, and add them to the folders you’re sharing on Grooveshark. Some of us are setting up special “seed points” to house tens or even hundreds of thousands of files, but we can’t do this alone… There is no reason why ANYONE in the company should not be able to do this, and I expect everyone to have this done by Monday ….”

Plaintiffs had alleged that Escape is liable for for both Direct Infringement under the theory of respondeat superior and Secondary Infringement.

Conclusion

This case is a perfect example of how the federal law Digital Millennium Copyright Act’s “safe harbor” works and how the Tech companies use it i.e., the company that hosts unlicensed third-party content ( in this cases user uploaded songs ) is required to take down the infringing content when it is notified by the copyright owner. From the above, it is clear that Escape did comply with the take-down requests, but to plaintiff’s dismay only to find another 10 illegal uploads sprout up in its place.

This case also shuns light on a very important question i.e., how is the DMCA’s safe harbor applicable to Universal’s pre-1972 sound recordings?. UMG had an early lawsuit against Escape in 2010 ( referred to as the State Court Action ), for the common law copyright infringement of UMG recordings that were created before 1972. The State Court Action ruling was in favor of Escape on the grounds that these recordings were not subject to federal law i.e., DMCA. In short, in USA, federal law protects most copyrighted works and the state/common law protects pre-1972 recordings. For the sake of achieving consistency in cases like this, this would have been easier if pre-1972 recordings were federalized. This is easier said than done since the ownership rules are different between federal and state laws, length of copyright ownership and copyright termination would be subject to change as well. The length of copyright for pre-1972 recordings are 95 years and are set to expire in 2067. Interestingly enough, it is the RIAA that seem to have a stance on opposing the federalization.