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Contacts: Jeff Joseph
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CEA Applauds Morpheus/Grokster Decision for Upholding Betamax Principles

Arlington, Virginia 4/28/2003

The following statement was issued today by Consumer Electronics Association (CEA) President and CEO Gary Shapiro regarding Friday's District Court ruling that Morpheus and Grokster file-sharing services are not responsible for copyright infringements by their users:

"Friday's decision is a landmark day in the ongoing effort to balance the need to protect copyright with manufacturers' right to innovate in the digital age. This decision reaffirms a fundamental principle as set forth by the U.S. Supreme Court in the Betamax case: a technology is legal if it is capable of substantial non-infringing uses.

"The District Court was correct in ruling that the file-sharing services in question have legitimate uses and that these services, in and of themselves, are not responsible for any possible copyright infringement by their users. The decision is a critical piece of the puzzle in developing a new approach to intellectual property issues in the digital age.

"Our industry depends on strong intellectual property protection, and we do not condone piracy or infringement. However, the Court's decision correctly focuses not on consumer behavior, but on technology and innovation. Innovation helps the U.S. economy and consumers. Opponents should carry a heavy burden to show that a new technology is illegal. Technology developers should be able to create innovative, exciting new technologies without fear of copyright liability.

"We will continue to work with the Congress and all interested parties to find a balanced approach to protect copyrights and maintain a legal environment that allows for technological innovation."

About CEA:
The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the consumer technology industry through technology policy, events, research, promotion and the fostering of business and strategic relationships. CEA represents more than 1,000 corporate members involved in the design, development, manufacturing, distribution and integration of audio, video, mobile electronics, wireless and landline communications, information technology, home networking, multimedia and accessory products, as well as related services that are sold through consumer channels. Combined, CEA's members account for more than $85 billion in annual sales. CEA's resources are available online at www.CE.org, the definitive source for information about the consumer electronics industry.

CEA also sponsors and manages the International CES - Defining Technology's Future. All profits from CES are reinvested into industry services, including technical training and education, industry promotion, engineering standards development, market research and legislative advocacy.