I.  INTRODUCTION AND SUMMARY OF ARGUMENT

                 In the fall of last year Napster introduced its 

             revolutionary peer-to-peer file-sharing technology based on a 

             real-time directory of Internet files created, named, and 

             controlled by individual Internet users that are available 

             for immediate sharing with other Internet users on a 

             one-to-one basis.

                  Because of the advantages of peer-to-peer technology and 

             the extent to which it empowers individual Internet users, 

             theimportance of Napster's technology has been widely 

             recognized.  Intel Chairman Andy Grove:  "The whole Internet 

             could be rearchitected by Napster-like technology."  Yahoo 

             President Jeff Mallett:  "Peer to Peer is going to change 

             traditional companies' models ... and change the model for 

             Internet companies as well."  (Washington Post, July 18, 2000 

             p. 2)  Even Recording Industry Association of America 

             President Hilary Rosen acknowledges with respect to Napster 

             technology that:

             
                       "Not only could it be used legitimately, there are 
                       certainly no illusions by me or anybody else that I 
                       work with that somehow, depending on the outcome of 
                       this lawsuit, file sharing or file copying gets put 
                       back in the box. ... Innovation is certainly here 
                       to stay.  Peer-to-peer is here to stay."  (CNET 
                       News.com July 20, 2000)
             
                       Although Napster's Internet directory can be used 

             for a large variety of files, the primary initial use of the 

             technology (and the purpose for which it was initially 

            designed) is to provide Internet users with a list of other 

             users who are prepared to share, on a one-to-one 

             noncommercial basis, certain music files.  Noncommerial 

             sharing of music among individuals is common, legal 

             (expressly approved, inter alia, by 17 U.S.C. §1008), and 

             accepted.  Even the RIAA's President says:  "It's cool to 

             make tapes, it's cool to trade them with your friends.  It's 

             good to share music."  (National Public Radio broadcast, June 

             7, 2000)

                       The District Court entered a preliminary injunction 

             against Napster, based on its conclusion that Napster 

             contributed to the illegal distribution of copyrighted music.  

             In so doing the court resolved several issues of first 

             impression against Napster, in favor of the record industry, 

             and in a way that limits the exchange over the Internet of 

             information that could indisputably be lawfully exchanged in 

             other ways.