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Federal courts long ago established that music fans have certain "fair use" rights when it comes to making copies of recordings they own. They can transfer recordings from one format to another—such as from LP to cassette tape or from CD to MiniDisc—and they can share those recordings with others, provided that the results are only for private, noncommercial use.

"Fair use" does not include mass replication, however, even if it is for noncommercial purposes. Is Napster, the audio file-sharing Internet service, simply software that lets music fans swap favorites, or is it something more akin to a tape duplication house operating in clear violation of copyright law? The music industry, in its full-scale legal attack on the Silicon Valley company, contends that Napster enables the wholesale piracy of music.

Napster has recently gone on the offensive, hiring high-profile attorney David Boies, who successfully prosecuted the federal government's anti-trust case against Microsoft. Napster's legal team filed a brief in San Francisco Superior Court on Monday, July 3, claiming that its operation is protected by "fair use" provisions in copyright law and that it should be considered in the same light as an individual making a compilation disc for him- or herself. Citing a clause in the 1992 Audio Home Recording Act that permits "noncommercial use by a consumer" of copies of copyrighted material, Napster attorneys argue that sharing MP3 files is entirely legal, and that whether one person or a million do it makes no difference.

San Francisco intellectual-property attorney Fred Von Lohmann agrees. Citing copyright scholar David Nimmer, Von Lohmann says, "Nimmer said . . . that as he understood the home taping exception, it would be perfectly legal for everybody in San Francisco to go to Golden Gate Park on a Sunday afternoon with all their CDs tucked under their arm and a bunch of tape decks and share their CDs and make copies for home use."

Although Napster users can be likened to a group of music fans meeting in the park, Napster, the company, is a commercial business using music as a lure for visitors. No outside advertising can currently be found on its website, but it has previously featured advertising from other companies wanting to reach those visitors. That's the part that officially rankles the Recording Industry Association of America (RIAA). "Whether or not it is lawful for users to share music one-on-one, it is entirely different for a commercial entity to create a business that induces users to do that," RIAA vice president and general counsel Cary Sherman said in a statement on Wednesday, July 5. "Napster cannot hide behind what consumers might be able to do, individually and on their own, to build its own commercial business."

The part that unofficially rankles the industry is the possibility that music lovers are building vast libraries of music for free. Published studies have offered conflicting interpretations of Napster's effect on music sales: some say it hurts, others say it helps. In its brief, Napster claims that the pre-release of Tom Petty's song "Free Girl Now" on the Internet helped boost sales.

In fact, Internet pre-releases have been embraced by the industry as a great marketing tool: serious music fans are known to want to collect all of their favorite artists' works, including commercial and noncommercial recordings.

One workaround for the music industry would simply be to buy out Napster and begin using it for profit, which appears to be the solution reached in a settlement with MP3.com. According to Napster, CD sales overall have grown by 8% since the service began.