Court’s Ruling in Audio Home Recording Act Case a Win for Consumers and Innovation

Yesterday, the U.S. Court of Appeals for the D.C. Circuit issued an important opinion impacting innovation and copyright.

In 1992, Congress passed the Audio Home Recording Act (“AHRA”) to address important questions arising from the advent of digital audio tape recordings in the late 1980’s.  As digital audio recorders became more common, the prospect of “home copying” loomed as a major issue, pitting the companies who produced the devices and the consumers who used them against the musicians and record companies who were concerned that authorized sales of music recordings would decrease as a result of the technology.

At the time of enactment, Congress made the decision to exclude computers from the AHRA’s scope.  More than 25 years later, the Alliance of Artists and Recording Companies (“AARC”) urged the D.C. Circuit to reinterpret the AHRA broadly so that it would apply to computers.  Specifically, AARC claimed that in-vehicle audio recording devices that copy music from CDs onto hard drives within the devices, allowing the music to be played back inside the vehicle even without the CDs, are digital audio recording devices under the Act.  Based on this assertion, AARC alleged that the suppliers of the devices, along with the automobile manufacturers that sold vehicles containing the recording, had violated AHRA by failing to pay royalties and adopt the required copying control technology with respect to the devices. 

CDT joined with EFF, the R Street Institute, the Consumer Technology Association, Engine, and the Information Technology Industry Council in filing an amicus brief led by the Computer & Communications Industry Association highlighting the adverse impact of AARC’s reading of the statute on the computer and consumer electronics industries. Our brief explained that if the court agreed with AARC’s interpretation of AHRA, every computer that could store music would potentially have to comply with the AHRA’s serial copy management requirements or be subject to significant statutory damages.  Moreover, manufacturers could potentially have to pay the AHRA’s levy for each of their computers. This would impose a heavy burden on both consumers and manufacturers, and would stifle competition. 

Yesterday the D.C. Circuit agreed that AHRA should not be applied to computers. The court noted: “[T]he legislative history of the AHRA indicates that at least two features of the enacted legislation were meant to ensure that personal computers and computer storage media generally would not be subject to the Act.”  

While these issues will continue to be raised before Congress and in the courts, yesterday’s decision was a victory for technological innovation and consumers.