By David Kravets

A federal appeals court is blessing the legal process by which the recording industry and other content owners unmask the identities of alleged peer-to-peer copyright infringers.

The decision by the 2nd U.S. Circuit Court of Appeals is believed to be the first appellate court to sanction a process that has ultimately hauled tens of thousands of alleged P2P infringers into court, (.pdf) many at the request of the Recording Industry Association of America.

“They have upheld the RIAA’s legal strategy,” said Richard A. Altman, the New York attorney who brought the court challenge.

Thursday’s decision comes as Indie filmmakers are using the same process to acquire the identities of thousands of BitTorrent users accused of copyright infringement.

The legal action was brought by a State University of New York at Albany student accused of using Gnutella to download and make songs available on the internet.

The RIAA detected what it claimed to be infringing activity on an IP address the university linked to the student. The unidentified student moved to quash a federal judge’s order that the university forward the student’s identity to the RIAA.

The student asserted a First Amendment right of privacy on the internet, in addition to a fair-use right to the six music tracks in question.

The appeals court ruled in the RIAA’s favor after balancing a constitutional right to remain anonymous against a copyright owner’s right to disclosure of the identity of a possible “trespasser of its intellectual property interest.”

“To the extent that anonymity is used to mask copyright infringement or to facilitate such infringement by other persons, it is unprotected by the First Amendment,” the appeals court wrote.

And even if a defendant claims a fair-use right to the material in question, content owners have a right to learn the identities to commence a lawsuit, the court wrote.

“And although Doe 3 indicates that he ‘may’ have had a permissible purpose for copying and sharing the music found in his file-sharing folder,” the court wrote, “any assertion of such a purpose raises questions of credibility and plausibility that cannot be resolved while Doe 3 avoids suit by hiding behind a shield of anonymity.”

The RIAA, in snaring thousands of file sharers, has used an undercover detection process wherein investigators comb P2P networks, download songs and obtain IP addresses from P2P users’ open share folders.

With that IP address and evidence, the RIAA and other content owners file so-called John Doe federal lawsuits. As part of the process, they request a judge to require the ISP to turn over the name of the account holder connected to the ISP.

Until 2003, the RIAA and others generally did not need to file lawsuits to obtain a subpoena to unmask an alleged peer-to-peer infringer. That year, however, a different federal appeals court ruled (.pdf) a lawsuit was necessary as a precursor to unmask P2P infringers because the content in question did not reside on an internet service provider’s server.

Still, copyright owners do not need to file a lawsuit to unmask the identity of alleged infringers in which the content in question is stored on an ISP’s servers — for example, YouTube, said Ben Sheffner, a Los Angeles copyright attorney who publishes the Copyrights & Campaigns blog.

The Copyright Act carries penalties of up to $150,000 per violation.