DULUTH, Minnesota – The federal judge who presided over the nation's only peer-to-peer copyright-infringement trial announced from the bench here Monday that he is likely to declare a mistrial.

"Certainly, I have sent a signal to both sides of where I'm headed," U.S. District Judge Michael Davis said during a 70-minute hearing in which lawyers for the Recording Industry Association of America and defendant Jammie Thomas sparred over whether a jury verdict against Thomas should be overturned.

At issue is whether the RIAA needs to prove that copyrighted music offered by a defendant on a peer-to-peer network was actually downloaded by anyone. During Thomas' trial last October, Davis, on the RIAA's recommendation, instructed (.pdf) the jury that no such proof was necessary; if Thomas had the music in her Kazaa shared folder, where it could be downloaded, she could be found liable "regardless of whether actual distribution has been shown."

But in May, long after Thomas had lost the trial and was dinged $222,000, Davis developed second thoughts. He wrote in an order that he may have committed a "manifest error" with that instruction. "I think I surprised everyone," Davis said at the outset of the Monday's hearing. As the hearing wrapped up, there was little evidence that the RIAA's lawyer had changed the judge's mind.

Judge Michael DavisThe judge's decision, which he said would be issued "hopefully before the end of September," is likely to have wide-ranging implications in the RIAA's file-sharing litigation campaign – 20,000 lawsuits and counting. Most cases have settled out of court for a few thousand dollars without resolving the question of whether the RIAA must prove that music shared over a peer-to-peer network had actually been downloaded.

RIAA attorney Donald Verrilli Jr. urged Davis not to disturb the $222,000 judgment against Thomas for unlawfully distributing 24 songs, drawing skeptical questioning from the Clinton-appointee.

The judge said that the Copyright Act appears to outlaw only an actual transfer of copyrighted material. The law gives a rights holder the exclusive right "to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending." Congress, Davis noted, has not added language supporting Verrilli's position: that actual downloading is implied by the act of putting content in a shared folder.

"Why didn't Congress do that?" the judge asked.

"There is nothing in that language that the plaintiff must demonstrate a transfer," Verrilli countered.

The primary reason the RIAA is making the argument – a position backed by the Motion Picture Association of America – is because it is generally not technically possible to determine whether somebody is downloading files from another's share folder on a peer-to-peer network. "The downloads are all done in secret," Verrilli argued.

"It's all done behind a veil" and "significantly diminishes the economic value of our sound recordings," he said.

Donald Verrilli Jr., the RIAA's lawyer, urged the judge not to disturb the $222,000 jury verdict against Thomas.

Photo: David Kravets/**Wired.comVerrilli said illegal distribution is implied on Kazaa and other file sharing networks. "There's no doubt it's being done millions and millions of times," he said.

He added that if Thomas or other file sharers aren't liable for copyright infringement for using peer-to-peer applications, "the distribution right doesn't mean anything."

He pointed out the Napster case, in which the financial backers of a peer-to-peer network were liable for infringement even though there was no proof that the public downloaded songs on Napster.

Thomas, a 32-year-old Minnesota mother of two, did not attend the hearing. Her attorney, Brian Toder, told Judge Davis: "Your honor, I believe she is in labor."

Toder, in his argument, told the judge that if a mistrial was not declared, the court would be inventing "a new right of recovery."

"Would Congress really fashion a statute where a plaintiff doesn't have to prove liability?" Toder asked.

While reciting parts of the Copyright Act, which allows fines of up to $150,000 per violation, Toder said, "They have to prove every element that a statute requires."

"That is good public policy," he said.

Neither a federal appeals court nor the U.S. Supreme Court has decided the issue; and Davis' decision, either way, is certain to be appealed by the losing party. At least three other federal judges have ruled against the RIAA on this point, but those rulings were in pretrial stages and didn't summarily kill the cases.

Brian Toder, Jammie Thomas' attorney, said he expects a mistrial to be declared.

Photo: David Kravets/**Wired.comStill, even if Judge Davis rules against the RIAA, that doesn't mean Thomas or others who challenge RIAA lawsuits would automatically win.

The reason: RIAA detectives always download some of the shared music files themselves. In the Thomas case, RIAA investigators downloaded 24 songs from the 1,702 that were in the 32-year-old woman's publicly available share folder.

In court briefs, (.pdf) the RIAA asked that the judge, if he finds that proof of downloading is necessary, allow the files downloaded by the RIAA's investigators to be counted as unlawful distribution. Toder, however, argued that the RIAA should not be allowed to use downloads it made from Thomas or anybody else's share folder.

Those downloads, Toder said, cannot be considered unauthorized downloads because the RIAA authorized them.

"You can't infringe your own copyright," Toder said.

The RIAA learned of Thomas' identity, and the identities of the thousands of others it has sued, by logging on to Kazaa or other file sharing systems and obtaining users' IP addresses that are accessible to anybody using the network. A case is commenced after the internet provider –- via an RIAA subpoena – coughs up the identity of the account holder attached to an IP address.

The case is Capitol Records Inc., et. al. v. Jammie Thomas, No. 06-1497 (MJD/RLE).

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