MGM’s rebuttal opened with a real howler, and I am a little surprised that none of the Justices interrupted their lawyer to challenge it, but he was speaking pretty quickly and forcefully, so I guess they were inclined to let him sum up. Addressing the relief MGM was seeking, their lawyer said: Grokster is a machine built upon inducing infringement and we are entitled to an injunction shutting it down. The obvious rejoinder, based on the lower courts’ express findings in the case, is that an injunction can’t shut down Grokster, the network, because it exists completely apart from Grokster, the company. If this was an attempt at some sleight of hand with the technologically unsophisticated judges, I don’t see it going anywhere, because the questioning of both sides seemed to reflect that the Justices have a hearteningly clear grasp of what the software does and doesn’t do. MGM also argued that the Ninth Circuit’s decision was itself chilling technological innovation, although they defined “innovation” as innovation authorized by copyright holders. MGM closed with its pity-the-starving-artists line, complaining about the lost revenues from hypothesized sales it says would have occurred absent file-sharing.
See also this CNet-hosted photo gallery