Access denied: Court shuts down copyright infringement claims

August 25, 2017
Patterson Thuente IP

Vocabulary matters in the courts, as one company found out recently. According to the Ninth Circuit Court of Appeals, the term “volitional conduct” has nothing to do with voluntary actions when it comes to direct copyright infringement. The court explained the meaning in a case where it also denied a copyright holder’s secondary liability claims for infringement.

Case downloaded

The Usenet is a collection of users whose computers connect to each other to exchange messages. Giganews, Inc., owns and operates several Usenet servers and provides fee-based access to content it stores on its servers, as well as content stored on other Usenet servers. Most content is uploaded by Usenet users.

Perfect 10, Inc., owns the copyrights on thousands of adult images, many of which have been illegally distributed over Giganews’ servers. It sent Giganews numerous letters fashioned as takedown notices under the Digital Millennium Copyright Act.

When Perfect 10 sent Giganews machine-readable, unique IDs associated with uploaded content, Giganews quickly removed the infringing material from its servers. Perfect 10 then faxed Giganews notices with illegible IDs. Giganews requested legible IDs in a machine-readable format. Perfect 10 declined to provide the requested IDs.

Perfect 10 sued Giganews for direct, contributory and vicarious infringement. The trial court ruled in favor of Giganews, and Perfect 10 appealed.

“Volitional” filter explained

In reviewing the direct infringement claim, the Ninth Circuit emphasized that the word “volition” in the copyright infringement context doesn’t refer to an “act of willing or choosing” or an “act of deciding.” Instead, the volition element of direct infringement is a basic requirement of causation. In other words, direct liability must be based on conduct that directly caused the infringement.

Perfect 10 argued that Giganews directly infringed its exclusive rights to display, distribute and reproduce its material. But the appellate court disagreed, finding that Giganews didn’t take any active role in the display, distribution or reproduction of the images. While Giganews provided a tool for viewing images, it was the users who called up the images and caused them to be displayed. Giganews merely passively stored material at the direction of users to make that material available to other users on request. Any distribution was done automatically when users requested uploaded images — not as a result of volitional conduct by Giganews. And Giganews didn’t “instigate” the copying, storage or distribution of the images.

Shared liability rejected

The appeals court also affirmed the lower court on contributory and vicarious liability. Both are a type of secondary liability for the infringement of others.

To establish contributory liability, a plaintiff must show that the defendant significantly contributed to or induced the infringement. A computer system operator significantly contributes to infringement if it:

Has actual knowledge that specific infringing material is available using its system, and

Can take simple measures to remove the infringing material.

The appeals court found that Giganews lacked the requisite knowledge and had no such removal measures available.

Inducement liability requires a showing that the defendant distributed its device or product to promote its use to infringe copyrighted material. The court found insufficient evidence of such intent.

As for vicarious liability, Perfect 10 needed to show that Giganews received direct financial benefit from the specific infringing activity at issue. But it presented no evidence that customers were drawn or subscribed to Giganews’ services because of the Perfect 10 images.

Screened out

This case could prove a cautionary tale for copyright holders interested in pursuing infringement claims against online service providers in similar circumstances. Not only did Perfect 10 lose its case, but it also ended up on the hook for more than $5.6 million for defense costs and attorneys’ fees. •

Perfect 10, Inc. v. Giganews, Inc., No. 15-55500, -55523, -56026, Jan. 23, 2017 (9th Cir.)

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