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File-Sharing Firms May Be Liable, Says High Court

Grokster, a distributor of file-sharing software, may be sued under copyright laws, according to a Supreme Court ruling. The court ruled that Grokster provided both technical means and advice to users seeking to download copyrighted material without paying royalties.

The justices' decision sends a "peer to peer" filesharing case back to a lower court for trial. Film and music companies had sought to stop Grokster and other services like Streamcast from providing ways to defeat copyright laws. Two lower courts had ruled against the industry groups, saying Grokster could not be sued for copyright theft committed by its users.

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