Court Rules for Record Industry in Net Case

In a victory for the record industry and a loss for privacy activists, a federal judge ruled Tuesday that telco Verizon (VZ) must reveal the name of an Internet user who downloaded music from the Internet.

The decision, which Verizon says it will appeal, spotlights the record industry's ongoing legal battles to protect its copyrighted property from online piracy, using measures that consumer groups say come at the expense of personal privacy.

Coming only a few days after Disney (DIS) and other media companies won a significant Supreme Court decision over copyright term lengths, the case also illustrates how the judicial system has become an important battleground for intellectual property policy, similar to how nearly all telecom competition winds its way through the courts.

At issue in the Verizon case is a subpoena it received last summer from the Recording Industry Association of American, the music industry trade group that represents, among others, the five major record companies: AOL Time Warner's (AOL) Warner Music Group, Vivendi Universal's (V) Universal Music Group, Sony's (SNE) Sony Music Entertainment, EMI Group and Bertelsmann's BMG Entertainment.

Through the subpoena, the RIAA sought Verizon's help in finding the name of a Verizon Internet access customer who the RIAA says downloaded more than 600 files, mostly individual songs, in a single day from the KaZaA file-sharing network. The RIAA, which had the Internet address of the computer user at issue, said it was Verizon's responsibility to supply further identifying information under the terms of the Digital Millennium Copyright Act of 1998.

Verizon, saying it was obligated to cooperate with the subpoena only if the songs the RIAA says were pirated were stored on Verizon's hard drives, refused to comply, precipitating Tuesday's decision.

In his opinion, Judge John Bates of the U.S. District Court for the District of Columbia ruled that the DMCA did indeed apply to Verizon in this case. While acknowledging that the case might raise certain questions relevant to the Constitution, Judge Bates said Verizon didn't develop these issues in its argument, and the subpoena process did not appear to have "an obviously fatal constitutional flaw."