The internet revolution has brought some legitimate legal questions in the Copyright Laws and "Fair Use". The Copyright Laws are designed to protect the copyright owners, but in defense of the rights of consumers for copying for personal use, Congress put in provisions of "Fair Use". Definitions of "Fair Use" are still being worked out by the courts.
In 1984, the US Supreme Court ruled 5-4 (in Sony vs. Universal Studios) that "Time Shifting" was a fair use...the BetaMax VCR could be used for videorecording of TV programs so that a TV show could be watched later if it was for non-commerical home use.
In 1999, in RIAA vs Diamond Multimedia, the courts legitimized portable MP3 players, calling "Space-shifting" or "Format-shifting" fair use. For non-commerical use, you can change music to MP3 format for playing on a portable MP3 player, or make a copy for your car CD player.
David Boies, who defended Napster, argued that file-sharers copied music for non-commerical use, which was permitted by RIAA vs. Diamond Multimedia. "So when Napster's users engage in noncommercial sharing of music - noncommercial copying of music - is that activity copyright infringement?
"We say it is not, for two basic reasons. The first is that this kind of noncommercial consumer copying is recognized as fair use under common-law theories and doctrines, and under the Supreme Court's criteria. And second, with respect to audio recordings - that is, music - the Audio Home Recording Act directly says that noncommercial copying by consumers is lawful. The 9th Circuit, in
RIAA v. Diamond Multimedia Systems, in 1999, read that statute as permitting all - and
all is the word of the opinion - all noncommercial consumer copying as lawful."
Source:
http://www.wired.com/wired/archive/8.10/boies.html
The courts ruled against Napster, but millions of MP3's were shared by millions of people while it lasted. In spite of court rulings, file-sharing programs still flourish, which has resulted in the RIAA now going after individual file sharers.
We probably haven't heard the last of it. One of the individual file sharers being sued, will no doubt appeal and this could end up in the US Supreme Court. And Congress may pass new laws to clarify the use of file-sharing programs.
For now, the law of the land is that the file sharing is illegal.
See
http://www.eff.org/IP/eff_fair_use_faq.php