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Vicarious Copyright Infringement Explained

Dec 3rd, 2016 | By | Category: Copyright Litigation

Copyright Infringement Essentials – What you need to know about “Vicarious” Infringement

liability for employees piracy

Introduction

This blog will discuss “vicarious copyright infringement” which is sometimes alleged in a lawsuit dealing with a violation of a copyright holders legal rights whether it relates to books, video games, artist drawings, music, pirated software, architecture or other creative works of authorship fixed in a tangible medium of expression.

Federal Case law

In one Bittorent federal case from Oregon the Court discussed this legal principle:

“Furthermore, Plaintiff did not allege, nor do its allegations support, a claim of vicarious infringement. See Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259, 261 (9th Cir. 1996) defining vicarious infringement as

(1) control over the direct infringer,

and

(2) direct financial benefit” from the infringement.

Plaintiff Fails to Allege Vicarious Infringement The second theory of secondary copyright-infringement liability that Plaintiff fails to make out is vicarious infringement. Liability under this theory may be found “when the defendant profits directly from the infringement and has a right and ability to supervise the direct infringer,” See also Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913 (2005),

This is why you may see pressure being put on companies that are involved in a software compliance audit from large publishers like Autodesk and Microsoft, or trade associations such as the business software alliance or SIIA.  Basically, the company being audited will be sought to be held liable for all software downloaded by its employees, and even third party IT contractors or third party designers.  When this happens, the natural reaction is to deny responsibility for what other architects or engineers might have done, and to deny liability for what software an employee might have installed with direction, instruction or authorization from the employer.

Nevertheless, when there is an ability to control, and a financial benefit that can be imputed on the employer, this can make a case for vicarious liability for the pirating acts of another (ex. a “bring your own software” installation policy at a small or medium sized business).

Other federal cases have discussed vicarious responsibility theories:

“Plaintiff Fails to Allege Vicarious Infringement The second theory of secondary copyright-infringement liability that Plaintiff fails to make out is vicarious infringement. Liability under this theory may be found “when the defendant profits directly from the infringement and has a right and ability to supervise the direct infringer,” See Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913 (2005),  Plaintiff alleges no facts to suggest that Defendant profited directly from any infringement committed by any third party. The closest it comes is ¶ 23:

Many parties, and possibly defendant have been compensated for their participation in expanding the availability of pirated content to others through BitTorrent networks, including plaintiff’s movie.” The mere possibility that Defendant was compensated – when Plaintiff itself uses the word – obviously fails to satisfy the Twombly/Iqbal standard of pleading. Further, Plaintiff’s allegation is logically inconsistent with the requirements of a vicarious infringement claim:

Plaintiff says Defendant was “possibly” compensated for his own participation in expanding the availability of pirated content. But if he had actually participated, then there is no need to pursue an indirect liability theory. For a successful vicarious infringement case, Plaintiff must plead and prove that Defendant profited from the infringement of another whom Defendant had the right and ability to control. Plaintiff has done no such thing, and so its allegations, taken as true, fail to establish liability for vicarious infringement. The First Amended Complaint’s “indirect infringement” count is subject to dismissal if it is interpreted to be a vicarious infringement claim.

This highlights the importance, if you are the Plaintiff in the copyright case, to closely examine your facts and carefully and artfully draft your complaint so that it is not subject to a motion to dismiss and possible subsequent claim for attorney fees.

The Napster case

One federal court case from the ninth circuit discussed how vicarious liability can be stretched beyond the employer/employee relationship.  In Napster the court discussed:

“We turn to the question whether Napster engages in vicarious copyright infringement. Vicarious copyright liability is an “outgrowth” of respondeat superior. In the context of copyright law, vicarious liability extends beyond an employer/employee relationship to cases in which a defendant “has the right and ability to supervise the infringing activity and also has a direct financial interest in such activities.
“Before moving into this discussion, we note that Sony ‘s “staple article of commerce” analysis has no application to Napster’s potential liability for vicarious copyright infringement. See generally 3 Melville B. Nimmer & David Nimmer, Nimmer On Copyright §§ 12.04[A][2] & [A][2][b] (2000) (confining Sony to contributory infringement analysis: “Contributory infringement itself is of two types—personal conduct that forms part of or furthers the infringement and contribution of machinery or goods that provide the means to infringe”).
The issues of Sony’s liability under the “doctrines of ‘direct infringement’ and ‘vicarious liability’ ” were not before the Supreme Court, although the Court recognized that the “lines between direct infringement, contributory infringement, and vicarious liability are not clearly drawn.” Id. at 435 n. 17, 104 S.Ct. 774. Consequently, when the Sony Court used the term “vicarious liability,” it did so broadly and outside of a technical analysis of the doctrine of vicarious copyright infringement.  (“Vicarious liability is imposed in virtually all areas of the law, and the concept of contributory infringement is merely a species of the broader problem of identifying the circumstances in which it is just to hold one individual accountable for the actions of another.”); see also Black’s Law Dictionary 927 (7th ed. 1999) (defining “vicarious liability” in a manner similar to the definition used in Sony).
See A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1022–23 (9th Cir. 2001), as amended (Apr. 3, 2001), aff’d sub nom. A&M Records, Inc. v. Napster, Inc., 284 F.3d 1091 (9th Cir. 2002), and aff’d sub nom. A&M Records, Inc. v. Napster, Inc., 284 F.3d 1091 (9th Cir. 2002)

Contact a Federal Infringement Attorney for Copyright and Trademark cases

If you need help with a software piracy investigation or other copyright infringement claim, contact us at (877) 276-5084 for a no cost initial consultation. We can help you ascertain your potential legal rights and explore possible defenses against vicarious liability claims, charges, demands and allegations.  We have extensive federal court experience.

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We are a business and civil litigation firm with a focus on copyright infringement cases involving illegal movie downloads (torrent cases such as London Has Fallen, ME2 Productions and Malibu Media defense), software audits (ex. Microsoft audits, SPLA, Autodesk audit notification letter, Siemens PLM defense, SIIA, Adobe and Business Software Alliance defense) and other software vendors threatening piracy and infringement. We also handle cases involving internet law, anti-SLAPP, media law, right of publicity, trademarks & domain name infringement, and we have a niche practice area handling California BRE licensing disputes, accusations, subpoena response, statement of issues and investigations. We have offices in San Francisco, Beverly Hills, Newport Beach, San Diego & Phoenix, Arizona and accept federal copyright and trademark cases nationwide. All content on our website is general legal information only and not a substitute for legal advice, and should not be relied upon. Decisions to hire counsel should not be based on advertising alone. Blogs, videos and podcasts are authored by Steve Vondran, Esq. unless otherwise noted. We can be reached at (877) 276-5084.

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