Copyright

• Author: International Law Group

AOL Germany formed an online forum for AOL members only where they could store, copy, and swap digital recordings of music productions. AOL maintained and organized the data files, and had so-called "scouts" review them for viruses and copyright notices.

The largest German distributor of music data files, Hit Box Software GmbH (HBS), located in Karlsruhe, Germany, brought a 1998 action against AOL in a Munich court. For prices ranging from $9- $19, HBS distributes so-called "MIDI files" of instrumental music that one can play only on diskettes. The buyers are mostly amateur musicians and performers. They use them as the bases for their own performances, similar to "karaoke" productions. Plaintiff claimed that AOL should pay HBS the profits that it would have received had it sold the data file as many times as people downloaded it from AOL, that is, approximately $50,000.

At issue were three instrumental versions of pop hits (including "Get Down" by the Backstreet Boys) which many people use as "karaoke" tracks. HBS claimed that AOL's service facilitated the illegal copying of the files and the resulting copyright infringements. AOL countered that such activities are impossible to control on the internet. Thus, if AOL tried to block a certain website, e.g., www.xyz.com, it would appear the very next day as "www.xyz1.com."

According to AOL, anybody can copy data files such as the music productions at issue and distribute them via the internet. Therefore, German law should treat such data files as...