Transcript: Pump Up the Volume

This is a partial transcript from "Your World with Neil Cavuto," March 29, 2005, that was edited for clarity.

STUART VARNEY, GUEST HOST: My next guest says that even if the Supreme Court rules against Grokster it's not going to stop people from downloading and sharing files.

Mark Gorton is the CEO of Limewire, one of the largest file sharing software companies.

All right. If the Supreme Court rules against you, what happens to your business?

MARK GORTON, CEO, LIMEWIRE: My business could be in trouble. I mean, there's no doubt about that. But you have to distinguish between Limewire the business and Limewire the PC software. Our software is released under and open source license that allows anyone to take it and modify the software. So...

VARNEY: You're telling me we can't put you out of business? We might put your business out of business, but we can't put your software out of business?

GORTON: That's right.

VARNEY: It's here to stay.


VARNEY: Nothing to do about it?

GORTON: Would be very difficult.

VARNEY: OK. If they rule against you, do you think that it's going to stop innovation in high-tech products down the road? Would you look at that argument?

GORTON: It would have a real chilling effect in the U.S. And you look at some of the companies that have weighed in, you know, Intel, Yahoo!, the whole Consumer Electronics Association. I mean, the U.S. has, you know, very strong protections for technology development, and that could be put at risk here.

VARNEY: But understand, if the Supreme Court views you and your product as legalized theft, how come stopping that and putting it out of business is going to stop innovation in technology?

GORTON: Well, I don't think they view it that way. And I think you have to distinguish between a fairly neutral technology that allows file transfer, and theft. I mean, they're different things and there are lots of components in the technology that allow that to happen.

VARNEY: Yes. But face it, the person who makes the music or makes the film doesn't get paid using your software?

GORTON: Well, that's paid. But they don't get paid from using a Cisco routers either, and they're also part of the whole file transfer chain.

VARNEY: All right. Mark Gorton, CEO, Limewire. Stay right there. Thank you very much for joining us, though.

Now for the other side, Ted Olson, a former U.S. solicitor general and the lawyer for the advocacy group Defenders of Property Rights, and Dan Glickman, president of the Motion Picture Association of America.

Dan, first to you, if I may. You heard my guest say right there, look, you can't stop this, regardless of what the Supreme Court does. What say you?

DAN GLICKMAN, PRESIDENT, MOTION PICTURE ASSOCIATION OF AMERICA: Well, first place this is not neutral behavior. This encourages people to illegally take music and movies and use it without compensation.

And so I think that the answer to him is that you've got to enforce the law. The law requires people to be compensated for creating music and movies and, by the way, for creating software and high-tech, as well. And any technology that's built on a business model that encourages people to steal is one that needs to be stopped, and that was our argument today.

VARNEY: Ted Olson, if it's not going to go away, is there no kind of technological innovation that your side can bring to the table to stop it in another way?

TED OLSON, FORMER U.S. SOLICITOR GENERAL: Well, in the first place you can't make crime go away. You can't make criminals go away.

But these are businesses that are created for the purpose of unlawfully taking copyrighted materials. They make — the more money they make — the more copyrighted materials that are taken, the more money they make. So these are business models created on copyright theft.

You can stop that. You can stop that type of activity. The recording industry and the motion picture industry are trying all of the time to stop unlawful copyright infringement. It just so happens that people keep coming up with other things, but that doesn't mean you give up the battle and give into the thieves.

VARNEY: Gentlemen, I'm trying to get to grips with this, because it seems to me that the digital genie is out of the bottle. And you may sort of go step by step putting various businesses and business models out of business, but ultimately you cannot put this down completely. It is going to grow. I put it to you.

GLICKMAN: Well, if I'm — first of all, as Ted says, you've got to try to stop it. But I do think that our industry, the motion picture industry, as well as the music industry is doing its best not only fight this illegal business model, but also to offer hassle free, legal reasonable cost ways for consumers to get the material online.

And we got to do both kinds of things. We've got to enhance the technology that's out there to make it easily available and reasonably cost. But also, you've got to stop the illegal activity.

Look, what we're talking about here is people coming up with the capital to make movies, to produce music, and it's not going to — it's not going to happen if people don't get paid for it.

VARNEY: Sun Microsystems, Verizon, Yahoo!, a whole host of high-tech companies are on the other side of the fence from you. They say that if you win, technological innovation is halted or at least slowed. What say you?

OLSON: They're not really saying that, and they're not defending the Grokster model, which is based on theft of copyrighted material. What they're saying is if the Supreme Court should go further in this case they should be careful to protect innovation.

We're not against that at all. In fact, patent protection and copyright protection is built into the Constitution to protect innovators and to protect invention. If you don't protect the property rights in those that create the products, whether it be music or inventions, then people will not invent, people will not invest in invention. So we are in an effort to protect the innovative process.

VARNEY: Ted Olson, Dan Glickman, thanks for joining us, gentlemen.

GLICKMAN: Thank you.

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