Advanced Copyright Issues on the Internet - Fenwick & West LLP

liability for contributory infringement on the part of a person who causes an infringement byauthorizing it. Under the reasoning of the Subafilms decision, even if loading material onto aserver encourages (or authorizes) copying through downloading, that authorization does notsuffice for direct liability. 1140However, as discussed in greater detail in Sections II.A.4, II.C, and II.D above, theFrena, Webbworld, Sanfilippo and Hardenburgh cases seem to go further in their willingness toimpose direct liability on a BBS operator, at least where an actor such as a BBS operator orwebsite operator has some form of direct involvement in the anticipated acts that lead toinfringement or in the infringing acts themselves (such as resale of the infringing material).Such acts of direct involvement in the infringement process may be sufficient for a finding ofenough volitional activity to impose direct liability. As noted below, however, legislationlimiting the liability of OSPs might negate or limit the holdings of these cases.(a) Louis Vuitton v. Akanoc SolutionsIn Louis Vuitton Malletier, S.A. v. Akanoc Solutions, Inc., 1141 the defendants operatedhosting services for a number of web sites overseas from which counterfeit Louis Vuittonmerchandise could be purchased. The plaintiff brought claims for direct and contributoryinfringement of its copyrights. A jury found the defendants liable for willful contributoryinfringement and awarded statutory damages, and found that the defendants were not entitled tothe safe harbors of the DMCA. After the verdict, the defendants filed a motion for JMOL withrespect to the claims. 1142 The defendants argued that they could not be liable for contributorycopyright infringement because, among other things, the acts of direct infringement – thereproduction of counterfeit merchandise and the storage of digital images of that merchandise onthe servers of their web site – occurred extraterritorially in China and the digital images couldnot be “copies” of the copyrighted merchandise. 1143The court rejected these arguments. With respect to territoriality, the court noted thatunauthorized copying and public display of a copyrighted work within the United States triggersapplication of U.S. copyright law, and under Section 602, unauthorized importation into theUnited States of copies acquired extraterritorially is prohibited, acts which the defendants clearlyhad done. 1144 Concerning the public display right, the court noted that the Ninth Circuit hadadopted in Perfect 10 v. Amazon.com 1145 the “server test,” under which a computer ownerstoring an electronic image as electronic information and serving that information directly to theuser is displaying the information in violation of the copyright holder’s exclusive display right.Here, the evidence established that the defendants’ servers in China stored and served data,including pictures of the plaintiff’s copyrighted merchandise, for sale to U.S. customers, which1140 R. Nimmer, Information Law 4.10, at 4-39 (2001).1141 2010 U.S. Dist. LEXIS 85266 (N.D. Cal. Mar. 19, 2010).1142 Id. at *1-2.1143 Id. at *5-6.1144 Id. at *7-9.1145 508 F.3d 1146 (9 th Cir. 2007).- 263 -