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The Obama Justice Department’s arguments echo the ones made by the Bush Justice Department in a December 2007 brief, which said: “Congress has crafted a statute that serves as a deterrent to those infringing parties who think they will go undetected in committing this great public wrong.”

Now her lawyers are asking for a third trial on grounds that the total fine is unreasonably, and even unconstitutionally, high.

Jammie Thomas

Federal prosecutors argue the relevant law is “carefully crafted” and consistent with “due process” and part of a necessary “regime to protect intellectual property. Under current law, copyright holders can sue for up to $150,000 per work (such as an MP3 file, DVD, or book).

The RIAA has said it’s willing to settle its Minnesota case against Thomas for far less than the seven-figure sum it’s now owed. “It was a jury of regular folks who rendered this decision,” Jonathan Lamy, a spokesperson for the RIAA, said in June. “We do not seek any specific damage awards. For the few existing cases, this verdict is a reminder of the clarity of the law. With any case, including that of Ms. Thomas-Rasset, we seek to settle these out of court. We stand ready and willing to talk settlement with Ms. Thomas-Rasset or anyone. We think that’s most beneficial for everyone involved.”

In a legal brief filed Friday, the U.S. Department of Justice said the whopping $1.92 million fine that the Recording Industry Association of America slapped on Thomas was perfectly constitutional.

One of the RIAA attorneys in the Thomas case was Donald Verrilli of Jenner and Block in Washington, D.C. In February, Obama named Verrilli to a senior Justice Department post as associate deputy attorney general.

Nearly two years ago, the Bush administration sided with the major record labels in their civil lawsuit against an alleged and briefly famous Kazaa user named Jammie Thomas. Now the Obama administration is doing so as well.

Thomas’ attorneys’ brief filed last month says the up-to-$150,000-per-song statutory damages “bear no reasonable relation to the actual injury suffered by the plaintiffs. The damages awarded are grossly in excess of any reasonable estimate of that injury…An award of statutory damages of $1.92 (million) for 24 songs assessed as punishment, not compensation, shocks the conscience and must be set aside.”

(Credit:
Jammie Thomas)

In the case of Jammie Thomas–now Jammie Thomas-Rasset–a jury decided that she had willfully infringed copyrights on 24 songs and awarded the RIAA a total of $222,000. Her lawyers successfully argued for a new trial, in which the RIAA won $80,000 per song in damages, or a total of $1.92 million.

Friday’s filing wasn’t exactly unexpected; for one thing, the Justice Department is generally tasked with defending acts of Congress from legal challenges. It sided with the RIAA in a recent Massachusetts case, and in an unrelated peer-to-peer case in New York.

Their brief adds: “Congress took into account the need to deter the millions of users of new media from infringing copyrights in an environment where many violators believe that they will go unnoticed.” It does not take a position on issues other than the constitutional ones.

For one thing, he promised the crowd of financial analysts, it can be a huge money maker.

“When you are at scale it can be a hugely profitable business,” Lu said.

REDMOND, Wash.–In the wake of Microsoft’s search deal with Yahoo, online chief Qi Lu outlined why the business is so important to Microsoft and how the company hopes to make headway.

But the challenge goes further, he said, noting that smaller players, by their nature, have fewer ads to show, meaning those ads are less relevant and the search experience is not only less profitable, but less desirable for users.

The Yahoo deal will help Microsoft in the scale arena. Combined, the two companies would have more than triple the search share that Microsoft has on its own. That said, the combined entity still has less than half of Google’s share.

“Overall the early feedback from the market has been encouraging,” Lu said. “It’s a good step, but it’s the first step in a long, long journey.”

“We want to be brutally honest about where we are,” he said. “It’s going to take time.”

But, even beyond the scale issues, Lu acknowledged that Microsoft also faces a brand challenge. He said that studies show that given a choice between Google’s brand with another provider’s results and Google’s results with another provider’s brand–users will choose the Google name, which has become synonymous with search.

Answering those challenges won’t happen overnight, he said.

“People will prefer the Google brand because of the strength it has,” said Lu, who joined Microsoft from Yahoo at the end of last year.

(Credit:
Microsoft)

For example, suggested searches are based on a fairly simple algorithm, but one that gets much better the more queries a search provider sees.

Lu

“With larger scales there are several important advantages,” Lu said. “There is an almost immediate lift in the quality of user experience.”

Microsoft relaunched its search engine as Bing in June and has seen a slight bump in market share, though it remains to be seen whether it can hold onto and build on that initial interest.

The problem is that many of the costs are the same even if you are not operating at scale, which is the place Microsoft has found itself. “Even if you have one user you have to crawl the whole Web.”

The official release of Microsoft Windows 7 has earned an Outstanding rating from CNET, and in this gallery you’ll see why. Whether this is your first time looking at
Windows 7 or you’ve been testing the operating system since the beta release in January, this slideshow is a comprehensive look at what Windows 7 offers.

Windows 7: RTM in pictures

Thursday’s vote represents only a small first step toward more federal rules. While not all formal inquiries result in new regulations, FCC Chairman Julius Genachowski did stress that his agency should be “relentless” in its pursuit of wireless innovation.
CTIA, the organization which represents the big wireless operators in the U.S., has said that the industry is very competitive and innovative.

One possibility is that the FCC could force mobile providers to sell subsidy-free phones, which a Democratic bill introduced last year would have required. Another is ending exclusive deals between carriers and handset makers, which would target deals such as the one Apple made with AT&T.

The FCC has intervened in Google’s so-far unsuccessful attempt to include its Google Voice application in the App Store. Last week, AT&T told the agency that it was not involved in the Google Voice decision; Apple claims a decision is still pending.

CNET News has posted a redacted version of Google’s reply to the FCC, which doesn’t explain why its application has not been approved.

The Federal Communications Commission decided unanimously on Thursday to review the state of “innovation” in the wireless industry, a move that could lead to greater regulation of carriers and government intervention in disputes such as one that recently erupted over Google Voice and the Apple App Store.

All five FCC commissioners, including the two Republicans, voted to approve a pair of investigations into the wireless industry. One will look broadly at the state of competition and innovation, and the other, as CNET News reported last week, will evaluate whether truth-in-billing rules ensure subscribers know what they’re paying for on their monthly phone bills.

If AT&T was not involved in the decision, the FCC may not have the legal authority to intervene. As a federal appeals court in Washington made clear in the broadcast flag case, the agency’s authority does not usually extend to computer hardware, at least in cases that Congress has not explicitly authorized.

There doesn’t appear to be any specific task that triggers the hard drive to enter its unresponsive state. Users on Apple’s support forums are reporting that it seems to be completely random and doesn’t matter where they are or what they are doing when it happens.

The hard drive issue does not require the user to force-reboot the computer, which would cause any unsaved work to be lost. Simply waiting out the unresponsive system apparently works every time.

(Credit:
Apple)

“We are aware of the issue and are working on a software update,” Apple representative Bill Evans, told CNET News on Monday. He gave no time frame for the release of the software update.

People have been reporting that they hear a beep from the computer shortly before the hard drive clicks and then the computer stops responding. The computer is unresponsive for 10 seconds or so and then begins to work normally again.

It does appear that the issue only affects the 500GB hard drives that run at 7200rpm.

Owners of Apple MacBook Pro notebooks with 7200rpm 500GB hard drives have been complaining for months of clicking sounds followed by temporary stalling. According to Apple, a fix is in the works.

The Plastic Logic e-reader is an electronic reader designed specifically for mobile users. The device will be about the size of an 8.5-inch by 11-inch pad of paper and weighs less than most magazines. It seems to be an ultrathin, simple, and strong device, gauging from a recent demo.

Olive is a prominent digital publishing company that produces hundreds of newspapers and magazine titles across multiple platforms–including electronic reading devices, smartphones, browsers, and Internet-enabled TV.

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Plastic Logic)

Plastic Logic e-reader photos

So far, Amazon’s Kindle has been in a safe position as one of the dominant electronic readers on the market. However, this may be changing because its rival, the Plastic Logic e-Reader, has been busy gaining prelaunch partners.

The Plastic Logic Reader is due to launch early next year. For now, it’s still unclear how much it will cost.

Plastic Logic, the start-up maker of the possible Kindle “killer” e-reader, announced Thursday that Olive Software will be a key service provider and partner for the Plastic Logic Publishers Program. The partnership means the two companies will develop content-publishing solutions for newspapers, magazines, and Web content providers, as well as other publishers that distribute their content via Plastic Logic’s e-reader.

Recently, Plastic Logic also hooked up with Barnes & Noble and announced that it will use AT&T’s 3G network.

Differentiating the new e-reader from the Kindle is the fact that it supports both 3G and Wi-Fi. This means you can download new content via wireless on the go, and from your home and office Wi-Fi networks. In addition, apart from published contents, the Plastic Logic e-reader supports popular document formats, including PDF, Word, PowerPoint, and Excel documents.

The Hewlett Foundation has bestowed more than $100 million in grants since 2001 to make educational materials available to all people for free.

A Wikimedia representative said the grant is coming at a “critical time” for the foundation that operates the online encyclopedia.

The San Francisco-based Wikimedia said it plans to use the grant to improve the user-friendliness of Wikimedia’s software, develop training materials to engage new potential volunteer editors, and establish metrics to track the foundation’s impact.

The nonprofit organization that operates Wikipedia has received a $500,000 grant from the William and Flora Hewlett Foundation to expand its effort to make educational information freely accessible.

“The enormous popularity of Wikipedia and its collaborative premise make the Wikimedia Foundation an ideal vehicle for spreading the open educational resources movement,” Barbara Chow, director of the education program at Hewlett, said in a statement.

“We’ve just begun the planning that will help us identify how to maximize our impact around the world,” Sue Gardner, the executive director of the Wikimedia Foundation, said in the statement. “This support will help us to execute our priorities for the current year, and enable us to plan for the future.”

“The ironic thing is that so much attention has been paid to the YouTube litigation,” von Lohmann said. “But the law is actually being made in other cases because the YouTube case is turning into an eternal trench war. In the meantime, smaller companies like Veoh and Perfect 10 are defining the law. The courts have consistently given an interpretation (of the law) that has been in line with what Web 2.0 companies have been arguing.”

“Veoh’s policies are very similar to YouTube’s,” von Lohmann said. “The judge gave Veoh a clean bill of health. I think the court in New York (where the Viacom-YouTube case is being heard) is going to take this ruling very seriously. The facts are very, very close.”

A federal district court says Veoh, a Web video site that has come under legal fire from entertainment companies the past several years, is not liable for the copyright violations committed by its users, a decision that could help YouTube defend itself against Viacom’s $1 billion copyright suit.

“The ruling today is wrong because it runs counter to established precedent and legislative intent and to the express language of the DMCA,” Universal Music said in a statement. “Because of this and our commitment to protecting the rights of our artists and songwriters who deserve to be compensated for the use of their music, we will appeal this ruling immediately.”

“Rather, the issue is whether Veoh takes appropriate steps to deal with copyright infringement that takes place. The record presented demonstrates that, far from encouraging copyright infringement, Veoh has a strong DMCA policy, takes active steps to limit incidents of infringement on its Web site, and works diligently to keep unauthorized works off its Web site. In sum, Veoh has met its burden in establishing its entitlement to safe harbor for the alleged infringements here.”

“This decision reaffirms the judicial consensus and what we’ve known all along: the DMCA protects services like YouTube,” Zahavah Levine, YouTube’s chief counsel said. “With the DMCA, Congress intended to foster online platforms like YouTube, which empower users, offer new distribution channels for content owners, and respect copyright.”

Martz’s decision is not binding on other courts and it must be noted that the case was heard in the Ninth District while YouTube’s court fight is in the Second District.

Universal Music Group, the largest of the four top record companies, accused Veoh of copyright violations in a lawsuit filed two years ago. But on Friday, U.S. District Judge A. Howard Matz granted Veoh’s motion for summary judgment, and ruled that the company is protected against such claims by the Digital Millennium Copyright Act.

In Martz’s decision, he noted that this was not the first time a court has ruled that Veoh is covered by the DMCA’s Safe Harbor provision.

The legal fight between Viacom and YouTube will likely go to trial sometime next year. Many observers thought that case would be the one to establish whether managers at YouTube and similar services would be required to police their sites. But YouTube vs. Viacom could be anticlimatic, according to von Lohmann.

While the judge ruled against Universal Music group and delivered a blow to copyright owners, he also confirmed that such sites must take reasonable steps to stop infringement once they’ve been made aware of its existence on their sites.

“On August 27, 2008, Magistrate Judge Howard R. Lloyd, sitting in the Northern District of California, wrote that the court does not find that the DMCA was intended to have Veoh shoulder the entire burden of policing third-party copyrights on its Web site (at the cost of losing its business if it cannot),” Martz wrote in his decision.

To be sure, Universal Music will file an appeal to Matz’s decision and the case likely still has a long way to go.

Update 4:15 p.m.:
To include comments from YouTube and Viacom.

How YouTube may benefit

YouTube and Google could be the big winner in all of this, said Fred von Lohmann, senior attorney for the Electronic Frontier Foundation. Viacom accused YouTube of infringing its copyright in a lawsuit filed in March 2007.

“Our case is in a different forum, not bound by the Veoh case,” said Michael Fricklas, Viacom’s general counsel, in a statement. “We remain confident that we will prevail on the law and the facts. Today’s decision contradicts the consensus that sites and copyright owners share the responsibility to use readily available tools to minimize copyright infringements.”

The decision would have meant more for Veoh if the video site was still relevant. The company has fallen on hard times since YouTube and Hulu took control of most of the online-video sector. Veoh’s legacy, however, could be that it helped to establish that Internet service providers aren’t liable for crimes committed by users.

It looks like the annual Apple music event will be held on September 9 this year, according to AllThingsD.

CNET News reported last week that the September event will be music-focused, and will include an introduction of a new digital album format from Apple, called Cocktail. Apple is also expected to unveil changes to its
iPod lineup.

Though it had been reported earlier that the event would take place sometime that week, a source now tells AllThingsD that the exact date will be September 9, and that it will focus on music, meaning no tablet announcement.

If the date is correct, holding an event on a Wednesday would be a departure from Apple’s habit of holding these types of events on Tuesdays. The date also gives more credence to the rumor that it might be the day when the Beatles catalog at long last comes to iTunes. September 9 has already been announced as the day that the music of Fab Four will make its debut on the video game Rock Band.

The event’s main speaker is still unclear, though it would be a prime opportunity for CEO Steve Jobs to make his first public appearance since returning to full-time work. If the Beatles are involved, it’s hard to see how Jobs couldn’t be present.

(Credit:
Dong Ngo/CNET)

Personally, I think it’s likely many of those 5 million iPhones will be jailbroken by the locals. Now, if Apple’s claim that jailbreaking the phone can turn it into a weapon of mass disruption was true, this could be unsettling news for communist China.

What will be new to the Chinese people for sure, however, is the fact that the phone will be locked to Unicom. Yu Zaonan, general manager of the customer development department of China Unicom in Guangzhou, told International Business Times that China Unicom is hoping 5 million iPhones will translate into 5 million new customers for the company. Unicom currently is still far behind China Mobile, the largest cell carrier in the country, both in terms of subscribers and profit. Unicom hopes the iPhone will help it narrow this gap.

This will be the first time the phone is legally available in the country with the largest amount of cell phone users in the world. I find this sort of ironic, as, like most electronic devices, the iPhone is assembled in China.

Finally, it seems the Chinese people are about to be able to legally get their hands on the phone they have been building: the
iPhone.

Like almost everything nowadays, the iPhone is also from China.

The Chinese people are already acquainted with the iPhone. Prior to this, the phone has been available in China, as well as Vietnam and many other countries where Apple has no business partners, via smuggling.

Anyone not so well-off might just have to resort to used and jailbroken iPhones smuggled in from other countries. These phones cost somewhere between 400 yuan ($59) and 1,000 yuan ($146), according to International Business Times.

Locked phones are generally new to China and Asia, where people have had the freedom of getting any phone at any store and using it with any carrier. This deal between Apple and Unicom means they will get a taste of business the American way.

According to International Business Times, Unicom, China’s second largest cell carrier, has paid 10 billion yuan (about $1.46 billion) to buy 5 million iPhones from Apple. The first batch of the phones will be made available to Chinese customers as early as next month. Since March, the company has been posting the phone’s images and specs at its stores.

It’s unclear which versions of the iPhone (3G or 3GS) are included in this deal and whether the phones will have Wi-Fi disabled. However, according to Yu Zaonan, the price for the 8GB iPhone will be 2,400 yuan ($350) and the 16GB version will cost twice as much. This means the company’s hopeful new batch of 5 million subscribers will be those with substantially high incomes.