Is a technology provider liable for direct copyright infringement when it provides the means for infringement instructed by its users? In the Cablevision case, Cartoon Network, LP LLLP v. CSC Holdings, Inc., 536 F.3d 121 (2d Cir. 2008), the Second Circuit endorsed a line of cases holding that the provider is not liable absent “volitional conduct” that causes the copying to take place. Two recent district court decisions in the Southern District of New York appear to have applied this rule in seemingly inconsistent fashion.
Most recently, in Cellco P’ship v. Am. Soc’y of Composers, 2009 U.S. Dist. (S.D.N.Y. Oct. 14, 2009), the court held that Verizon was not liable for direct copyright infringement where it provided the technology that allowed cell phone users to play ringtones. The opposite result was reached a few months earlier in Arista Records LLC v. Usenet.com (PDF), 633 F. Supp. 2d 124 (S.D.N.Y. 2009), in which the court found the defendants were directly liable where they provided the technology that allowed users to download infringing sound recordings. How can we make sense of these outcomes?
We begin with a quick overview of Cablevision, in which the Second Circuit held that Cablevision’s Remote Storage DVR System (“RS-DVR”) technology did not directly infringe the plaintiffs’ content. The Second Circuit noted that direct infringement could not be proven unless “volitional conduct” could be established. The Second Circuit found Cablevision’s conduct was analogous to a store proprietor who charges customers to use a photocopier on his premises, and unlike that of a copy service that makes copies at the customer’s request. As such, Cablevision was not directly liable.
The Cablevision decision was rooted in Religious Technology Center v. Netcom On-Line Communications Services, Inc., 907 F. Supp. 1361 (N.D. Cal. 1995), which held a bulletin board operator and internet service provider were not liable for direct copyright infringement where they provided access to a Usenet newsgroup containing infringing material:
These parties who are liable under plaintiffs’ theory, do no more than operate or implement a system that is essential if Usenet messages are to be widely distributed. There is no need to construe the Act to make all of these parties infringers. Although copyright is a strict liability statute, there should still be some element of volition or causation which is lacking where a defendants’ system is merely used to create a copy by a third party.
The Netcom court seemed troubled with the fact that under plaintiff’s theory of direct infringement, the entire internet would commit an act of direct infringement when a unauthorized copyrighted work was transmitted through its interconnected network of computers. The court did not believe that such a result was warranted by the Copyright Act. Netcom was followed by the Fourth Circuit in CoStar Group, Inc. v. LoopNet, Inc., 373 F.3d 544 (4th cir. 2004).
The Cellco decision followed the Netcom and Cablevision line of cases to hold that Verizon was not liable for direct infringement of the public performance right when users downloaded ringtones, or when ringtones were played on users’ phones. As in the Cablevision case, when attempting to determine if there was requisite volitional conduct, the court analyzed the manner in which a ringtone is activated:
Once the customer has downloaded the ringtone onto her telephone, she controls the telephone and makes the decisions that determine whether the ringtone will be triggered by an incoming call signal. And of course, it is someone else entirely — the caller — who has initiated this entire process.
In Arista Records LLC v. Usenet.com, the court held that the owners and operators of the Usenet.com website directly liable for facilitating the posting and downloading of unauthorized copies of plaintiffs’ sound recordings. In finding the volitional conduct requirement satisfied, the court relied upon the facts that defendants were aware that digital music files were among the most popular articles on their service and took active measures to create special servers dedicated to MP3 files. The defendants also took active steps, including both automated filtering and human review, to remove access to certain other categories of content (such as adult material), and to block certain users. Such activities, the court held, transformed defendants from a passive conduit where infringing activities happened to occur, to active participants in the process of copyright infringement.
It’s not easy to reconcile Usenet.com with Cablevision and Netcom. The defendants in Usenet.com certainly did not aid their case by engaging in spoliation of evidence and discovery misconduct. The district court was clearly correct in finding secondary liability for inducing infringement, contributory infringement and vicarious infringement. Instead of stopping there, the court went further, finding defendants sufficiently actively engaged in the process to be directly liable. Perhaps the analogy is to the proprietor of a high speed copy machine standing outside a bookstore inviting people to reproduce their newly purchased books. The district court decision suggests that, in such situations, the door remains open to a finding of direct infringement.