With the proliferation of music on massively popular file-sharing websites such as YouTube and Soundcloud, musical artists face legitimate concerns in terms of protecting their copyrighted works. It is no secret that copyright holders in the music industry have aggressively engaged in an extended online anti-piracy campaign. While this campaign originally targeted file-sharing software distributors, most famously, Napster, it has continued to evolve with the technologies available. Now, more than ever, individuals may be at increased risk of litigation for infringing activity, and they might not even be aware their activity is illegal.

Napster utilized peer-to-peer (“P2P”) networks in order to facilitate the download of files. In A&M Records, Inc. v. Napster, Inc., the Ninth Circuit held Napster vicariously liable for copyright infringement, reasoning that Napster facilitated direct infringement of artist’s copyrighted works and had reasonable knowledge that such infringement occurred. See A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1020 (9th Cir. 2001). Additionally, the court found Napster materially contributed to the infringement by allowing infringers to search for files and providing customer support. Id. at 1022. The court also noted that Napster received a financial benefit  because “Financial benefit exists where the availability of infringing material [attracts] customers.” Id. at 1023. Finally, the court held that Napster had the ability to supervise infringing activity by blocking known infringers’ access to the software. Id. The combination of these factors led the court to hold Napster vicariously liable for the actions of it’s users.

The downfall of Napster was merely a bump in the road for copyright infringers, and the case’s outcome did not end the battle against online piracy. Instead, a new open-source P2P networking software called BitTorrent rose to prominence and took Napster’s place. However, the nature of BitTorrent’s software created real problems for litigation. Unlike other P2P networks, BitTorrent’s indexes are shared, and downloading occurs via a piecemeal process whereby a user can receive different portions of the file from multiple users, through a process known as “seeding.” Furthermore, the torrent seeds themselves are not infringing, as the actual seeds are completely unrelated to the file that will be downloaded.

Copyright holders could not pursue litigation against BitTorrent in the same manner as Napster. BitTorrent merely provides open source P2P networking software, and has taken steps to ensure it will not be held vicariously liable. Unlike Napster, BitTorrent has minimal content on its website and does not advertise its software as a means of downloading copyrighted works, both of which serve as an effort to avoid a legal finding of material contribution. Furthermore, because the software is open-source and the indexes are shared, BitTorrent does not have direct control over potential infringing material and is thus unlikely able to police the actions of its users.  Learning from the Napster example, BitTorrent proceeds with caution to avoid actions that could be construed as inducing infringement.

In this way, P2P networking software distributors have insulated themselves from litigation, thereby leaving groups such as the Recording Industry Association of America (“RIAA”) with fewer enforcement options. Potential targets for copyright infringement lawsuits continue to disappear as companies pay attention to copyright cases in the courts and modify their actions appropriately. As a result, copyright holders began targeting individuals rather than software providers, and found recent success using subpoenas to identify individual infringers. See Well Go USA, Inc. v. Unknown Participants in File Sharing Swarm, 4:12-CV-00963 (S.D. Tex. Sept. 25, 2012).

Despite this development, individuals, who are likely not as attentive to developments in copyright law as companies are, continue to download infringing material online. Recently, there has been a tremendous increase in the use of Youtube-to-MP3 Converters (“converters”). These converters are easily accessed online, and utilize a process known as “Transcoding,” which facilitates data conversion from one digital encoding to another, i.e., from a movie file to an audio file. Through this process, converters are able to strip the music portion of a video on YouTube, and make it available for download to individual users in the form of an MP3 file.

Following BitTorrent’s lead, these converters have minimal content on their websites, they do not advertise, and they strive not to induce infringement. Going a step further than BitTorrent, however, converters do not utilize indexes.  Instead, a user must actively seek out a video and then enter a URL into the converter. The converters do not allow users to search for videos on their sites, nor do they provide links to infringing materials. Additionally, the site operators do not receive a financial benefit.  As a result, there is essentially no way to police infringing activity.

There may be an argument that converters are in violation of online streaming sites’ terms of service. However if the converters are not stored on servers physically located in the United States, the laws of the United States will likely not extend to them at all. Yet, while these converters may be immune from liability in certain situations, individual users of converters remain at risk.

Converter users however, appear generally unaware of their potential liability, believing the converters are a safe alternative to BitTorrent and are protected under “fair use” doctrine. However, this line of thinking is dangerously incorrect. When examining fair use, courts will look at: (1) the purpose and character of the work, (2) the nature of the copyrighted work, (3) the portion of the work used, and (4) the effect on the potential market for the work. Analyzing these factors in similar cases where individuals were sued for infringement, courts were reluctant to grant protection under the fair use doctrine. See BMG Music v. Gonzales, 430 F.3d 888 (7th Cir. 2005); Sony BMG Music Entertainment v. Tenenbaum, 672 F. Supp.2d 217 (D. Mass. 2009)

In conclusion, users should be aware that downloading MP3 files via converters will not immunize them from copyright infringement liability. The availability of music via YouTube and other similar streaming sites does not allow individuals to copy that material for their own private use. While the converters themselves may not be illegal per se, when individuals use them to obtain MP3 files from online streaming websites, they open themselves to liability under the Copyright Act. Furthermore, individuals who rely on the anonymity the internet provides and believe their identities will remain safely hidden are also mistaken, as copyright holders can subpoena identifying information from the internet service providers of individuals using the internet to infringe the rights of copyright holders.