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Secondary Infringment Liability in Copyright

Copyright like any other right conferring law strives to find out solution for issues which are often open ended in nature and attempts to reconcile incorrigible situation sensitive ad hoc mechanism and well defined rule. Thus, answer or solution to a given issue varies depending on the point of view from one is looking at it. There is no definite or concrete answer to the issues as they are open ended and susceptible to different solution depending on the ideological and economic policy in which one believes.

Copyright Ownership: Section 102 of the US Copyright Act contemplates that copyright protection subsists, in original works of authorship fixed in any tangible medium of expression. The works of authorship under the section, inter alia, includes motion pictures and other audiovisual works. We also need to examine whether the work is original or not. The Supreme Court in Feist Publications, Inc. v. Rural Telephone Service Co stated that the expression original in copyright context, means only that the work was independently created by the author (as opposed to copied from other works) and that it possesses at least some minimal degree of creativity. To be sure, the requisite level of creativity is extremely low; even a slight amount will suffice.

Rights: Now, we turn to the issue whether any creator of any allegedly infringing work has violated any of the exclusive rights given to author under section 106 of the Copyright Act. The section, inter alia, confers an exclusive right of reproduction as well as a right to prepare derivative work upon the copyright owner. Copyright in Fact: Copying in fact means that the creators of the alleged infringing work, in fact taken the copyrighted expressions from author and used that expressions in their work. Copying in fact can be proved either by direct evidence like contractual relationship between the plaintiff and the defendant or by indirect evidence to the effect that (1) the defendant had access to the plaintiffs work and (2) there is a similarity between the infringed and the infringing works.


Although copyright is a strict liability statute but there should still be some element of volition or causation to constitute direct copyright infringement. Let us assume a situation where a copyright infringing work (video) has been telecasted in Youtube . Now we turn to the issue whether YouTube is secondarily liable for hosting the infringing works in its website. It has become a well established principle of copyright jurisprudence that a person, who is not a direct infringer, may be held liable for copyright infringement if he/she participates in activities which secondarily contributes to the infringement. The legislative history of Section 106 of US Copyright Act, which uses the expression to authorize, suggests that the congressional intent behind the use such expression was to make the secondary participants liable for copyright infringement under appropriate circumstances. Courts have developed two major theories of secondary liability; vicarious liability and contributory infringement. Unfortunately the line between these theories of liability is often unclear. Vicarious Liability: The concept of vicarious copyright liability was developed in Shaprio Bernstien and Co. v. H.L. Green Co., which suggests that a person is liable when (1) he/she has the right and ability to control the infringing activities and (2) has obtained a direct financial benefit from the infringing activity. There are two lines of cases concerning vicarious copyright infringement. Landlord-tenant cases --- which suggest that a landlord who lacked knowledge of the infringing activities of its tenants and exercised no control over the leased premises cannot be held liable for infringing activities of the tenant. The dance hall cases --- which suggest that the operator of an entertainment venue is liable for infringing performance, when the operator can control the premises and obtained a direct financial benefit from the audience. Now, we need to turn to the question whether YouTube has control over its website. We know from Religious Technology Center v. Netcom On-Line Communication Services, Inc., that control means both actual and technical control. There is no doubt that YouTube has both actual and technical control over the infringing materials posted in its website. YouTube can remove any material posted in its website at any time it desires. The second issue is whether YouTube is deriving any direct benefit from the viewers or not. YouTube is available to the viewers free of cost and its main source of revenue is advertisement. There is nothing here to show that the infringing clips any way enhanced the revenue from advertisement. So, there was no direct financial benefit from the infringing activity. Therefore, YouTube cannot be held liable for vicarious copyright infringement. Contributory Copyright Infringement: When a person with knowledge of the infringing activity, induces, causes or materially contributes to the infringing conduct of another, he may be held liable for copyright infringement. We need to examine whether YouTube has knowledge of the infringing activity and it substantially participated in such activity or not. In Religious Technology Center v. Netcom On-Line Communication Services, Inc., the court held that where a defendant cannot reasonably verify a claim of infringement, either because of a possible fair use defense or the lack of copyright notices on the copies, the operators lack of knowledge will be found reasonable. Secondary infringement claims against the Individuals who posted The individuals who have uploaded the infringing clips may also be held secondarily liable for the infringing activities.In Religious Technology Center v. Netcom On-Line Communication Services, Inc., the Bulletin Board Operator was held not be liable for the contributory infringement as he lacked knowledge. Now, the individuals who have posted the infringing clips in the YouTube website will be liable for contributory copyright infringement if they have actual or constructive notice that the materials are infringing because the very act of uploading will constitute substantial participation. However, it will be difficult to establish vicarious liability for the individuals who have posted the infringing clips because they neither fit into the landlord-tenant nor fall under the dance-hall paradigm mentioned above.

Case Laws:
Religious Technology Center v. Netcom On-Line Communications Services, Inc. 907 F.Supp. 1361 (N.D.Cal. 1995) Erlich was a former Scientologist who was now critical of the group. He posted some Scientology documents in an internet newsgroup. The Scientologists informed Erlich that he was infringing on their copyright. In addition to sending notice to Erlich, they also notified Klemesrud, who owned the website Erlich used to post the documents, as well as Netcom, which was Klemesrud's internet service provider, and told them to block Erlich. After Klemesrud and Netcom took no action to block Erlich, the Scientologists sued everybody for copyright infringement. The Scientologists argued that when Erlich uploaded the documents, they were temporarily stored on Klemesrud's computer, then copies were made and sent by Netcom to places all over the internet. That would be a violation of the Scientologists' right to reproduce, the right to distribute, and the right to publicly display under 17 U.S.C. 106. Klemesrud and Netcom argued that they weren't responsible for what Erlich was doing, and they did not have the capability of screening their system to find every potential infringer. The Trial Court denied Klemesrud and Netcom's motion for summary judgment. The Trial Court found that the postings were definitely fixed enough to be copyrightable copies. See MAI Systems Corp. v. Peak Computer, Inc. (991 F.2d 511 (1993)). The Court found that Klemesrud and Netcom were not liable for direct infringement because the copying that occurred between the computers on the internet was incidental to Erlich's intentional copying of the documents to the internet. The Court likened the Klemesrud and Netcom to a photocopy machine where the public can make copies. The Court noted that if Klemesrud and Netcom were liable, then where would it end? Every computer connected to the internet copies data from other places on the internet, so the total number of potential infringers would be unreasonably large.

The Court found that even thought 106 is s strict liability Statute, there should be some element of volition or causation which is lacking where a defendant's system is merely used to create a copy by a third party. The Court looked to Gershwin Publishing Corp. v. Columbia Artists Management, Inc. (443 F.2d 1159 (1971) which defined contributory copyright infringement as where "one who, with knowledge of the infringing activities, induces, causes, or materially contributes to the infringing conduct." The Court found that Klemesrud and Netcom should have had knowledge of Erlich's activities. The Court found that Klemesrud and Netcom did not relinquish control of their system to Erlich, and could have stopped him if they wanted to. Their inaction rose to the level of substantial aid, and could constitute contributory copyright infringement. The Court defined vicarious copyright infringement as where a defendant has the right and ability to control an infringer's acts, and receives direct financial benefit from the infringement. The Court found that there was evidence to show that Klemesrud and Netcom had the ability to control Erlich's postings. However, the Court found that there was no evidence that Erlich's infringement gave any financial benefit to Klemesrud or Netcom. Later Congress enacted 17 U.S.C. 512, which establishes "safe harbor" and provides immunity from infringement liability under certain circumstances for internet service providers. Fonovisa Inc. v. Cherry Auction, Inc. 76 F.3d 259 (9th Cir. 1996) Cherry Auction ran a swap meet. Vendors would rent tables and sell whatever they wanted, while Cherry Auction collected an entrance fee from buyers, and provided advertising. Shockingly, some of the vendors were found to be selling bootleg music .Fonovisa, who owned the copyright on some of the bootleg music, sued Cherry Auction for copyright infringement. Fonovisa argued that Cherry Auction was (or should have been) aware that vendors were selling illegal music on their premises. Therefore, Cherry Auction was guilty of contributory copyright infringement, and vicarious copyright infringement. Cherry Auction argued that they only provided the space, it wasn't their job to police what the vendors sold. The Trial Court found for Cherry Auction in summary judgment. Fonovisa appealed. The Trial Court found that, as a matter of law, Cherry Auction could not be liable for sales by vendors who leased their premises. The Appellate Court reversed and remanded for trial. The Appellate Court looked to Shapiro, Bernstein and Co. v. H.L. Green Co. (316 F.2d 304 (1963)), and found that with regard to vicarious liability, there were two lines of cases: In "landlord-tenant" cases, the courts had held that a landlord who lacked knowledge of infringing acts of its tenants and who exercised no control over the leased premises was not liable for infringing sales by the tenants. In "dance hall" cases, the courts had found that a landlord can be liable for infringing performances when the landlord could control the premises, and obtained a direct financial benefit from the audience who paid to enjoy the infringing performance. The Court found that since Cherry Auction retained the right to kick any vendor out the 'controlled the premises', and since they collected admission at the door from people who came to buy bootleg music, they obtained a 'direct financial benefit', so there was evidence they were vicarious copyright infringers. The Court defined contributory copyright infringement as where "one who, with knowledge of the infringing activities, induces, causes, or materially contributes to the infringing conduct." The Court found that Cherry Auction knew about the bootleg music, and advertised to get more people to

come to the swap meet, there was evidence that they were contributory copyright infringers. Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417. What happened? Petitioners appealed a judgment of the United States Court of Appeals for the Ninth Circuit holding petitioners liable for contributory infringement in respondents suit against petitioners for copyright infringement in violation of the Copyright Act, section 101. Summary: Petitioners manufactured and sold home video tape recorders. Respondents owned the copyrights to television programs broadcast on public airwaves. Respondents sued petitioners for copyright infringement, alleging that because consumers used petitioners recorders to record respondents copyrighted works, petitioners were liable for the copyright infringement allegedly committed by those consumers in violation of the Copyright Act. The U.S. Supreme Court held that petitioners demonstrated a significant likelihood that substantial numbers of copyright holders that licensed works for broadcast on free television would not object to having such broadcasts recorded for later viewing by private viewers. The recorders were therefore capable of substantial non-infringing uses and respondents sale of the recorders to the general public did not constitute copyright infringement. In an opinion by Stevens, J., expressing the views of Burger, Ch. J., and Brennan, White, and OConnor, JJ., it was held that the sale of home video tape recorders to the general public did not constitute contributory infringement of copyrights on television programs since there was a significant likelihood that substantial numbers of copyright holders who license their works for broadcast on free television would not object to having their broadcasts time-shifted by private viewers and the plaintiff copyright holders did not demonstrate that time-shifting would cause any likelihood of non-minimal harm to the potential market for, or the value of, their copyrighted works. MGM Studios Inc. v. Grokster, Ltd., 5 U.S. 913(9th cir) What happened? Petitioner copyright holders sued respondent software distributors, alleging that the distributors were liable for copyright infringement because the software of the distributors was intended to allow users to infringe copyrighted works. Upon the grant of a writ of certiorari, the holders appealed the judgment of the United States Court of Appeals for the Ninth Circuit which affirmed summary judgment in favor of the distributors. Summary: Two companies that distributed free software, which allowed computer users to share electronic files through peer-to-peer networks were sued by a group of copyright holders who: (1) Alleged that the distributors had knowingly and intentionally distributed their software to enable users to infringe copyrighted works in violation of the Copyright Act sec 101. (2) Sought damages and an injunctionwhere, although the distributors software could be used to share any type of digital file, users of the software had mostly used it for unauthorized sharing of copyrighted music and video files. Court stated that: (1) Billions of files were shared across P2P Network. (2) The distributors were aware that users of their software used it primarily to download copyrighted files. (3) distributors received no revenue from users of their software, the distributors generated income by selling advertising space (4) No evidence that the distributors had tried to filter copyrighted material from users downloads or otherwise to impede the sharing of copyrighted files. Based on Sony Corp. of America v. Universal City Studios, Inc. (1984) 464 U.S. 417, 78 L. Ed. 2d 574 the United States Court of Appeals for the Ninth Circuit affirmed that distribution of a commercial product that

was capable of substantial non-infringing uses in this case gave rise to infringement since the distributor had actual knowledge of specific instances of infringement and failed to act on that knowledge. In an opinion by Souter, J., expressing the unanimous view of the court, it was held that: (1) One who distributes a device with the object of promoting its use to infringe copyright .is liable, under the Copyright Act, for the resulting acts of infringement by third parties using the device, regardless of the devices lawful uses. (2) There was substantial evidence against the distributors on all elements of inducement of infringement, (3) Infringement was overwhelming source of the distributors revenue from the software.

Indian Perspective
The liability of service providers for copyright infringement is not expressly covered by the Indian Copyright Act. The Information Technology Act, 2000 exempts ISPs from liability if they can prove that they had no knowledge of the occurrence of the alleged act, and that they had taken sufficient steps to prevent a violation. However, the existing provision does not clearly prescribe liability limits of service providers. For example, if a person makes a representation to a service provider claiming copyright on the material available on the network, will the service provider be liable if he fails to take steps within a reasonable time to remove the infringing material from the network? If the service provider fails to prevent infringement of copyright in the above circumstances, is the plea of not having knowledge of infringement still available to him? If the service provider removes the material from the network in pursuance to the representation made by a person which later on proves false, will the service provider be liable to the person whose material has been removed? The Indian position in liability of service providers for copyright infringement must be made more explicit. The I.T. Act must include sections that address the financial aspect of the transaction, and the relationship between an ISP and a third party, because this is vital to determining the identity of the violator. The American concept of contributory infringement can also be incorporated into the Indian Act so that if any person with knowledge of the infringing activity, induces, causes, or materially contributes to the infringing conduct of another, the person can be made liable. In order to be exempt from liability, the Indian Act requires the service provider to exercise due diligence to prevent the commission of copyright infringement. The Act does not provide the meaning of the term due diligence. If due diligence means policing each and every aspect of the Internet, it can lead to loss of privacy and can ultimately have a disastrous effect. There is a need for a consensus on the meaning of the term due diligence because the primary function of ISPs is to build the Internet, not to play the role of a policeman. If the behavior of an ISP is reasonable, then that ISP should not be held liable for each and every activity on the Internet as has been held by the US Courts. In matters of copyright infringement, a finding of secondary infringement does not happen too often. A. Section 51(a)(ii), which treats as infringement, the profitable permitting of any place for the purpose of communication of the work to the public where such communication itself constitutes an infringement of the copyright in the work, and B. Section 51(b), which treats as infringement, the selling, renting, distribution, exhibition or importation of infringing copies, are the instances in Indian law when secondary infringement is frowned upon.

John Doe/Ashok Kumar Makers of Ajay Devgn-starrer Singham have revealed their pre-emptive act of obtaining a rare injunction, prior to the release of the flick, has helped them in tackling the menace of film piracy. A John Doe Order was passed by Delhi High Court, on 20/07/2011 regarding this issue as informed by Sanjay Tandon, Vice President, Music and Anti-Piracy, Reliance Entertainment . John Doe Order is given against anonymous prospective offenders. It thus enables an IP owner to serve the notice and take action at the same time against anyone who is found indulged into infringing the copyright of the movie. "The John Doe received by us is the first of its kind. It now makes it illegal of making Singham through cable, Internet, physical DVDs or any other mode without a valid license," added Tandon.

The internet has been abuzz with news of all the major ISPs in India blocking popular websites including piratebay, vimeo, dailymotion and pastebin etc. This is pursuant to a Chennai high court order and there are a number of unanswered questions about the validity of the blocking of the websites including whether the DOT were entitled to ask for a blocking of the site on the basis of the orders, how the ISPs chose these particular websites since the order itself does not mention any particular website. This is not to mention the larger question of how the last ten years has seen the dubious rise of John Doe orders as preemptive measure against copyright infringement. In addition to this context, ex parte injunctions are not the easiest things to obtain since they are based on the denial of another persons right to be heard. So even for cases of violence against women getting an ex parte restraining order is not easy. In contrast the last ten years we have seen the ease with which one can obtain these orders for copyright infringement cases. A number of legal innovations in the realm of injunctions have been developed to tackle the problem of anonymity in this domain. The three specific tools that have been used include Ex-parte injunctions (injunctions that are granted even without hearing the other party) John Doe Orders (Issued against anonymous offenders; E.g Mirabhai Films got a John Doe Order against all cable operators before the release of Monsoon Wedding) Anton Piller Orders ( Search and seizure orders) including breaking down doors of shops which are closed.

The most recent Order in this issue is to several unknown Indians named Ashok Kumar.

The order basically says that Ms. Fifteen Majors ISPs and Mr Ashok Kumar, Ashok Kumar, Ashok Kumar, Ashok Kumar and Ashok Kumar should not infringe the copyright of the film 3.

the respondents/ defendants herein, and other unknown persons by themselves, their partners/ proprietor, heirs, representatives, successors in business, assigns, distributors, agents or anyone claiming through them be and are hereby restrained by order of interim injunction until further orders of this court from, in any manner infringing the applicants copyright in the cinematographic films/ motion picture 3 by copying, recording, reproducing or allowing camcording or communication or allowing others to communicate to making available or distributing or duplicating or releasing or showing or uploading or downloading or exhibiting or playing in or in any manner communication in any manner without a proper license form the applicant or in any manner that would violate/ infringe the applicants copyright in the said cinematograph film 3 through different mediums including CD, DVD, Blu-Ray disc, VCD, Cable TV, Direct to home services, internet services, multimedia messaging services, pen drives, hard drives, tapes, conditional access systems or in any other like manner whatsoever.

Now, the question is whether the John Doe Order is justified or not. We cannot deny that companies get huge benefit from the passion and craze of the viewers. Moreover, when it comes to the acceptance of Open Source usage of internet, then at the same time monopoly of a particular entity cannot be claimed.Consider for instance the fact that Microsoft did not enforce their copyright over illegal copies of their Operating system or products such as Microsoft office for years (despite being one of the best software companies in the world). They only started enforcing their copyright when there was enough of a mass marker that had been created and a lock in secured for their goods. At the end of the , every business is about the people, the mass. If they cannot avail any product easily, why would they be interested further? In the same way Kolaveri became what it is because of Ms. Ashok Kumar, Ashok Kumar, Ashok Kumar, Ashok Kumar and Ashok Kumar copying, communicating, uploading, downloading, modifying and distributing over the internet, through CDs, hard drives and pen drives the song and all its hundred variations. This wasnt just a catchy song going viral but an attitude going global. Fan clubs in south Indian have been marked by the excess investment that they make in stars and in films, an excess that moves between the monetary economy of box office hits and profits on the one hand and the generous economy of love, passion and enthusiasm on the other.

As discussed, in India, secondary infringment issues are not that clear.But to make it clear, we must keeep in mind, it must not harm the very essence of internet usage.In the name of copyright protection, obscenity, regulation etc we must not lessen the weightage of the term PRIVACY. Issues concerning the liabilty of the ISPs must be handled with great care because one sngle mistake in policy making can be detremental to the development of the insitution of internet as a whole.