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oet=15-2002 02:04en—Fron-O'MELVENY & MERSLLP LAI/2 #2134208407 Tees! Poo DAVID E, KENDALL (pra hige vi . WINLIAMS & NEY ELF COPY Ths Tweltth Suet, Washington, D.C. "20003 Telephone: (202) 434-5600 Facsimile: (202) 434-5029 Auveneys for the Muon Prcture Stach Plasatifs (Other than the Time Warner suulio pluentfs) RUSSELL J. AN (SBN 49087 pinengt ERSEAMARLGRENUPP DLP 11377 West Olympic Boulevard Los Angeles, CA 90064-1683 ‘Felephone: (310), 312-2000 Facsimile: (310) 312-3100 Autorneys for the Record Company Hlataniffs (Oimer thaa the Time Warner record company plaintsfs) ROBERT M. SCHWARTZ (SBN | 7166) ‘AREY R. MOS (pro h ice (SBN T1866) CAREY ARON URN ae O'MELVENY & MYERS S, RIF! : Po0s Avenne of the Stars, Seventh Floor WHARTON & GARRISON Los Angeles,CA 90067-6035 1285 Avenue of the Americas Telephone: G10) 553-6100 New York, NY 10019-6064 Facsimile: (310) 246-6779 Felephane (212), 3733000 ‘acsimile: (212) 757-3900 Attorneys for the Tume War aer Plauangfi Antoraeys for the Music Publisher Plasnngfs UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA METROGRH WYN-MAYER CV BIOS INC. er al, Case No. CV 01 08541 SVW. EINK (Consolidated with CV 01 09923 SVW plainstts, | ©”) F PLAINTIEES 1 MerENDANIS GROKSTER, LTD., eral MOTIONS FOR SUMMARY Defendants. | JUDGMENT Date: December 2, 2002 | Time: 1:30 em lon. Stephen V. Wilson JERRY LEIBER, et al., 13 Ctrm: The VEILED, UNDER SEAL PURSUANT 'TO PROTECTIVE ORDER] Plaintiffs, v. CONSRM ER EMPOWERMENT BV Defendants. AND RELATED COUNTERCLAMS. pryalW pth 8" OPPUSIHION 10 DEFENBAN ES NO HONS LOK SEMINARY 6 baMeNt EV a aS) SUW (PIWOD Oct-18-2002 02:08pm From-O"MELVENY & AYERSLLP LAI/2 2134306407 TH] Po0g F898 Y ‘TABLE OF CONTENTS I tABLE OF AUTHORITIES ..0o--~ 3 {|| INTRODUCTION AND SUMMARY OF ARGUMENT. sl |, DEFENDANTS ARE LIABLE FOR CONTRIBUTORY 4 INFRINGEMENT . 23 7 'A. Defendants Misconstrue the “Knowledge” Required for | Contributory Liability... 3 9 B. There Is Extensive Undisputed Evidence of Defendants’ 10 ‘Actual and Constructive Knowledge of Infringement .. 6 u C. Defendants’ Arguments That They Lack Sufficient Knowledge ra Ae Baseless nen . ae a D.__ Given the Undisputed Evidence of Defendams’ Knowledge, ” Sony-Betamax Is Not a Defense .. ev 15) E. — Sony-Betamax Does Not Apply for Many Additional Reasons ........ 12 16] F. There Is No Evidence That Defendams’ Systems Have n Commercially Significant Noninfringing Uses... 14 13) al DEFENDANTS ARE LIABLE FOR VICARIOUS INFRINGEMENT... 15 2d ‘A. Vicarious Liability Requires Only that the Defendant Have 7 the Ability to Exercise Supervision or Control Over Infringers....... 15 xl B. _ MusicCity Passesses the Ability to Supervise or Control x Users of Its Gnutella-Based System. 17 a4 1. MusicCity Conmrols Its Software and System. 25 2. The Current Morpheus System Demonstrates Numerous 26 Ways in Which MusicCity Controls ar Supervises Irs Users? Activities. = 19 27) 24 a. Central-Server Control Via the “Auto.xml” File... PLNIUNPS" DFP TU DREENDAN |S" MUTOS FORSEMMAKY JOUEMEST {Cv ar oH531 SVw GaN) eteiS-2002 02:08pm From-O°MELVENY & MVERSLLP LAI/2 2134308407 Teast pone Fe 38 b. Other Cenwal-Server Interactions with Users ...... Py 3 ¢. Aujomatic Distribution of Files Against Users’ A Wishes... 3, MusicCity’s Ability to Supervise or Control Is Sufficient d for Vicarions Liability. 2B 1 C. Grokster Has the Ability to Supervise and Control Its Users 3 se DEFENDANTS’ POLICY ARGUMENTS ARE SPURIOUS... ro] {¥. THE DUTCH JUDGMENT DESERVES NO DEFERENCE......... | CONCLUSION uawritys’ URPOSELION 10 BFF ENDANTS: MOTIONS FOR SEMASAIY JUPGMENS evo) oss SVW Ta