The Ninth Circuit Court of Appeals recently held in Perfect 10 v. Giganews, No 15-5550 (Jan 23, 2017), that an alleged copyright infringer can only be found directly liable if its “volitional conduct” actually causes the infringing activity to happen. Notably, the Court rejected Appellant’s argument that the Supreme Court’s ruling in American Broadcasting v. Aereo, Inc. removed this “volitional conduct” requirement.
Appellant Perfect 10, Inc. owns copyrights to several images. Appellee Giganews, Inc. owns and operates several Usenet servers and provides subscribers to user-stored content to other Usenet providers. Perfect 10’s images have been distributed by users over Giganews’s servers, and Perfect 10 sued Giganews for direct and indirect copyright infringement claims. The district court granted Giganews’s motions for summary judgment as to the direct and indirect copyright infringement claims. The Court reviewed the grant of summary judgment de novo.
To show a prima facie case of direct copyright infringement, Perfect 10 had to show “ownership of the allegedly infringed material” and “demonstrate that the alleged infringers violated at least one exclusive right” granted to copyright holders. Furthermore, direct infringement requires that Perfect 10 show causation, referred to as “volitional conduct,” by Giganews. In the context of copyright infringement, “volitional conduct” is akin to proximate causation in traditional tort analysis.
Perfect 10 argued that the Aereo decision removed this “volitional conduct” requirement. Specifically, because Aereo (a service that streamed television programming over the Internet) was found liable for copyright infringement when Aereo’s users streamed copyrighted television broadcasts and, while the Supreme Court had been asked to recognize the “volitional conduct” requirement, the majority opinion in Aereo did not explicitly do so.
The Court disagreed with Perfect 10’s argument, and held that the “volitional conduct” requirement is consistent with Aereo. Because the majority in Aereo did not expressly address volitional conduct and did not dispute Justice Scalia’s dissent in which he explained (and supported) the requirement, the Court held that the “volitional conduct” requirement is consistent with Aereo. Furthermore, because Aereo focused more on whether Aereo was actively or passively participating in the infringement, rather than on “volitional conduct,” the Court held that “the requirement was left intact” and “the district court did not err in requiring Perfect 10 to satisfy it.”
Lessons for Practice
While the Aereo decision warrants scrutiny for much of its copyright law analysis, it did not remove the “volitional conduct” element for direct copyright infringement. Like other commercial torts, copyright infringement requires that the alleged infringer proximately caused the infringement, i.e., engaged in volitional conduct that violates one of the rights vested in a copyright.
In the context of cloud-based systems, the fact that users upload copyrighted content does not alone show that the system owner (e.g., Giganews) infringed the underlying copyrights. Plaintiffs need to provide evidence that links actions performed by the system owner to the alleged infringement to survive summary judgment. Defendants should clarify conduct performed by the users and conduct performed by the system owners to break the causal link to the alleged infringement.