The D.C. Circuit just decided RIAA v. Verizon - the record industry's effort to subpoena the identities of file-sharers -- in favor of Verizon and other ISPs who argued that the law did not allow RIAA to obtain the information. The ruling was based solely on statutory interpretation: in the court's view, the relevant language simply was not intended to cover P2P sharing. The court did not reach any of the First Amendment points argued.

The ruling surprised many, most assuredly including me, who thought the RIAA had the better of the statutory argument, and that the district court had made the right decision. (Pass the crow, please.) Verizon's lawyers deserve credit for tenacity in what was regarded by most experts as a losing cause.

The decision will have serious consequences, not least for Verizon. The statute was passed in 1998 as a bargain; the ISPs got safe harbors and immunity against charges of contributory infringement. The content providers got help in identifying actual infringers. This decision leaves that bargain a smoldering ruin.

So the content industry will now be forced to file John Doe lawsuits to ferret out the identities of the illicit downloaders, which it clearly can do, but which will be more expensive for everyone, including Verizon. And one can expect an offensive by the content industry against the ISPs to limit the safe harbors, charging complicity in the P2P infringement if there is any indication whatsoever that an ISP approved of it or fostered it.

The decision also ensures that the Digital Millennium Copyright Act will be reopened in the next Congress, which will create a thorough mess.

So Happy New Year to all!