The Supreme Court's decision in Grokster left Sony in intact, but found it did not shield those who promote and encourage use of a product to infringe intellectual property. Euclid Managers Blog points out that "the case raised new concerns and considerations for some technology companies, particularly those whose product or service can be used for making unauthorized copies."
They go on to relate this to insurance costs for technology companies, saying:
"Companies may face a more fact-intensive examination of intent and objectives. That kind of lawsuit can make discovery more expensive, it can lead to more cases being filed for the purpose of going through the discovery process to see what’s there, and such a suit can be more difficult to defend. And summary adjudications may be more difficult to achieve in such cases.
Tech companies should be aware that someday a court may perform a balancing test of the product’s legitimate and illegitimate uses, and the standards that will be applied in that test are not entirely clear.
Predictability has gone down for developers, and their insurers, meaning that risk has gone up."
Source: Euclid Managers Blog - Home - Grokster, the Supreme Court and the Impact on Risk (June 30, 2005).
Posted by dougsimpson at July 10, 2005 07:02 AM