"We hold that one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties," Justice Souter wrote.
But there's a fine silver lining, as noted here: Hollywood triumphs in piracy fight.
Eric Garland, the CEO of file-sharing tracker BigChampagne who has followed the Grokster case closely, said Hollywood & Co. was looking to the Supreme Court to rule that peer-to-peer technology is illegal because it's used mostly for illegitimate purposes.
But the court, said Garland, sidestepped the issue in Grokster by focusing instead on how Grokster and StreamCast marketed themselves to potential customers.
"The entertainment industry really needed this to be about the technology. What they didn't get was a decision that said 'tools that allow people to exchange files freely on the Internet, without permission, are illegal,'" said Garland.
Not all is lost.