Hosting ISPs’ Secondary Liability Under the Roof of “Safe Harbor” Provisions

Wang, Jie

doi:10.1007/978-981-10-8351-8_4

Jie Wang²

596 Accesses

Abstract

The previous chapter discusses under what circumstances a hosting ISP meets the threshold of “safe harbor” provisions. This chapter will discuss how the courts in the US, EU and China to decide hosting ISPs’ secondary liability under the roof of the “safe harbor” provisions. In the light of “safe harbor” provisions, a hosting ISP who complies with certain requirements can be exempted from paying monetary damages. However, regarding the other kind of reliefs, such as injunction, “safe harbor” provisions cannot immunize hosting ISPs from them. Therefore, even though a hosting ISP fully complies with liability exemption conditions set in “safe harbor” provisions, it may still face liabilities other than paying monetary damages according to the traditional liability rules. Besides, as was mentioned in the end of Chap. 2, when interpreting “safe harbor” provisions, the courts cannot avoid being affected by traditional liability rules, so even though the US, EU and China have reached certain harmonization in the respect of “safe harbor” provisions, in light of case law, the secondary liability rules of hosting ISPs are still diverse in the US, EU and China. This chapter will take a comparative approach to examine the hosting ISPs’ secondary liability for copyright infringement on their platforms in the US, EU and China.

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Notes

1.
See DMCA, Sec. 512, (c)(1); E-commerce Directive, Art. 14; Regulation on the Protection of the Right of Dissemination via Information network (信息网络传播权保护条例) (thereafter “Internet Regulation (“网络规定)”), Order No. 468 of the State Council (国务院 468号令), May 18, 2006, Art. 22.
2.
DMCA (n1), Sec. 512, (m)(1).
3.
Patry WF (2009), § 21:85.
4.
See Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. 417 (1984), at 442.
5.
Ibid.
6.
Capitol Records, Inc. v. MP3tunes, LLC, 821 F.Supp.2d 627, at 633 (S.D.N.Y., 2011).
7.
Ibid, at 644–645.
8.
UMG Recordings, Inc. v. Shelter Capital Partners LLC, 667 F.3d 1022, at 1027 (9th Cir.2011), at 1027–1028.
9.
Ibid, 1037–1038.
10.
See Viacom International, INC. v. YouTube, INC., 667 F.3d 1022, at 1027 (9th Cir.2011), at 30–31.
11.
E-commerce Directive (n1), Art. 15.
12.
C-360/10, SABAM v. Netlog NV [2012], ECLI:EU:C:2012:85; Joined Cases C-236/08 to C-238/08, Google France SARL and Google Inc. v Louis Vuitton Malletier SA and Others, [2010] ECR I-02417; C-324/09, L’Oréal SA and Others v eBay International AG and Others, [2011] ECR I-06011.
13.
Opinion of Advocate General, L’Oreal v. eBay International AG, case C 324-9, at para. 163.
14.
LG Düsseldorf: Störerhaftung des Filesharing-Betreibers, 2008 MMR 759 (quoting S. Barazza, ‘Secondary liability for IP infringement: converging patterns and approaches in comparative case law, (2012) 7 Journal of Intellectual Property Law & Practice 879, at 885.
15.
OLG Hamburg: Haftung eines Sharehosting-Dienstes für rechtsverletzende Inhalte—Rapidshare II, GRUR-RR 2012, 335, (quoting Ibid).
16.
Loi n° 2004-575 du 21 juin 2004 pour la confiance dans l'économie numérique (thereafter “LCEN”), Art. 6-1-7.
17.
Waisman and Hevia (2011).
18.
Ibid.
19.
See Supreme People’s Court (最高人民法院), Interpretation of the Supreme People’s Court on Certain Issues Related to the Application of Law in the Trial of Cases Involving Computer Network Copyright Disputes (最高人民法院关于审理涉及计算机网络著作权纠纷案件适用法律若干问题的解释) (thereafter Internet Interpretation (2000)), Fa Shi [2000] No. 48 (法释[2000]48号), November 22, 2000., this Judicial Interpretation brought in a “notice-delete” mechanism and subpoena calling for information to identify infringers from DMCA 512.
20.
Ibid, the Judicial Interpretation did not address the issue of an ISPs’ monitoring responsibility.
21.
vale.com v. tudou.com (网乐互联v.土豆网), Shanghai First Intermediate People’s Court (上海市第一中级人民法院), No. 19 Hu Yi Zhong Min Wu (Zhi) Zhong Zi (2009) ((2009)沪一中民五(知)终字第19号).
22.
See Wangyajun v. Lingshida Tech. (王亚军v.北京零时达科技), Beijing Haidian District Court (北京市海淀区人民法院), No. 2775 Hai Min Chu Zi (2008) ((2008)海民初字第2775).
23.
This statement was presented at a press conference on introducing “The Provisions of the Supreme People’s Court on Several Issues Concerning Application of Law in the Trial of Cases Involving Disputes about Infringing Right to Internet Dissemination of Information (2013)” when the official was questioned about “ISPs’ monitoring liability”, http://www.sipo.gov.cn/mtjj/2013/201301/t20130121_783586.html (last visited 18-09-2014).
24.
People’s Republic of China Copyright Law (first revising draft), Art. 69, published by National Copyright Office in March, 2012. In second revising draft, the same rule is also provided in Article 69.
25.
Supreme People’s Court, Provisions of the Supreme People’s Court on Certain Issues Related to the Application of Law in the Trial of Civil Cases Involving Disputes over Infringement of the Right of Dissemination through Information Networks (最高人民法院关于审理侵害信息网络传播权民事纠纷案件适用法律若干问题的规定) (thereafter “Internet Provisions (网络规定)”), Fa Shi [2012] No. 20 (法释〔2012〕20号) November 26, 2012, Art. 8.
26.
DMCA (n1), Sec. 512 (c) (1) (A).
27.
E-commerce Directive (n1), Art. 14, 1.
28.
Internet Regulation (网络条例) (n1), Art. 22 (3).
29.
Nimmer (2003).
30.
Congress, U. S., H.R. REP.105–551(II), at 53.
31.
See Nimmer, Copyright: Sacred Text, Technology, and the DMCA (n328), at 358.
32.
Ibid.
33.
Ibid.
34.
See Io Group, Inc. v. Veoh Internets, Inc., 586 Supp.2d 1132 (C.D.Cal. 2008), at 1148; Corbis Corporation v. Amazon.com, 351 F.Supp.2d 1090, at 1108 (W.D. Washington 2004).
35.
See H.R. REP. 105-551(II) (n30), at 57–58.
36.
UMG Recordings, Inc. v. Veoh Internets, Inc., 620 F.Supp.2d 1081 (C.D.Cal.2008), at 1108.
37.
Perfect 10, Inc. v. CCBill LLC, 488 F.3d 1102, at 1114 (9th Cir. 2007). As stated by the court, the burden of determining whether passwords on a website enabled infringement is not up to the service provider. The website could be a hoax, or out of date. The owner of the protected content may have supplied the passwords as a short-term promotion, or as an attempt to collect information from unsuspecting users. The passwords might be provided to help users maintain anonymity without infringing copyright. There is simply no way for a service provider to conclude that the passwords enabled infringement without trying the passwords, and verifying that they enabled illegal access to copyrighted material. We impose no such investigative duties on service providers.
38.
Ibid. As stated by the court, contrary to Perfect 10's assertion, this disclaimer is not a “red flag” of infringement. The disclaimer specifically states that the webmaster has the right to post the files.
39.
Ibid. As stated by the court, describing photographs as “illegal” or “stolen” may be an attempt to increase their salacious appeal, rather than an admission that the photographs are actually illegal or stolen, and shouldn’t place the burden of determining whether photographs are actually illegal on a service provider.
40.
Io Group, Inc. v. Veoh Internets, Inc. (n34), at 1149. As stated by the court, with the video equipment available to the general public today, there may be little, if any, distinction between “professional” and amateur productions.
41.
UMG Recordings, Inc. v. Shelter Capital Partners LLC (n8), at 1040. In this case, the Court made a very interesting differentiation between the notifications from a copyright owner and the third party. The CEO of Disney sent an email to a Veoh investor, which stated that the movie Cinderella III and various episodes were available on Veoh without Disney’s authorization. The court decided that this email did not qualify as a red flag for the following reason: as a copyright holder, Disney was subject to the notification requirements in § 512(c)(3), which this informal email failed to meet. However, if this notification had come from a third party, such as an Internet user, it might meet the “red flag” test, since it specified particular infringing material.
42.
See Io Group, Inc. v. Veoh Internets, Inc. (n34), at 1149.
43.
See Viacom International, INC. v. YouTube, INC. (n10), at 33.
44.
Ibid.
45.
UMG Recordings, Inc. v. Shelter Capital Partners LLC (n8), at 1040.
46.
See Viacom International, INC. v. YouTube, INC. (n10), at 34.
47.
Ibid.
48.
Tiffany (NJ) Inc. v. eBay, Inc., 600 F.3d 93, at 110 (2d Cir. 2010).
49.
United States v. Aina-Marshall, 336 F.3d 167, at 170 (2d Cir. 2003) (quoting United States v. Rodriguez, 983 F.2d 455, at 458 (2d Cir.1993)).
50.
See Viacom International, INC. v. YouTube, INC. (n10), at 35. As stated by the Federal Court of Second Circuit, Section 512(m) is explicit: DMCA safe harbor protection cannot be conditioned on affirmative monitoring by a service provider. For that reason, § 512(m) is incompatible with a broad common law duty to monitor or otherwise seek out infringing activity based on general awareness that an infringement may be occurring.
51.
Viacom Int'l Inc. et al., v. YouTube et al, 07 civ. 2103 (LLS), 32 (S.D.N.Y. Apr. 18, 2013).
52.
E-commerce Directive (n1), Art. 14.
53.
Sadeghi (2013).
54.
Larusdottir (2004).
55.
L’Oréal SA and Others v eBay International AG and Others (n12).
56.
Ibid, para. 120.
57.
Ibid, para. 122.
58.
Fitzner J (2011), at 283.
59.
Ibid.
60.
OLG München: Gewerbeschädigende Äußerungen in einem Meinungsforum im Internet, 2002 MMR 612.
61.
Spindler, et al. (2008), at 1530.
62.
Telemediengesetz (TMG), Sec. 10(1).
63.
See Fitzner, Von Digital-Rights-Management zu Content Identification: neue Ansätze zum Schutz urheberrechtlich geschützter Multimediawerke im Internet: eine technische, ökonomische und rechtliche Analyse (n58), at 287.
64.
LG Düsseldorf: Markenrechtsverletzung durch Onlineauktion, 2003 MMR 120–127.
65.
BT-Drs. 14/6098, S. 25, (quoting Spindler, et al., Recht der elektronischen Medien: Kommentar (n61), at 1531.).
66.
See Spindler, et al., Recht der elektronischen Medien: Kommentar (n61), at 1531.
67.
Ibid.
68.
Google France SARL and Google Inc. v Louis Vuitton Malletier SA and Others (n12), at Para. 120.
69.
BGH, April 29, 2010, Case No. I ZR 69/08—Vorschaubilder.
70.
See Spindler, et al., Recht der elektronischen Medien: Kommentar (n61), at 1531–1532. Also see Fitzner, Von Digital-Rights-Management zu Content Identification: neue Ansätze zum Schutz urheberrechtlich geschützter Multimediawerke im Internet: eine technische, ökonomische und rechtliche Analyse (n58), at 289–290.
71.
Hoeren and Yankova (2012).
72.
Nérisson (2012), at 70.
73.
LCEN, Art. 6-5, quoting ibid, at 71.
74.
Ibid, at 71.
75.
Electronic Commerce (EC Directive) Regulations 2002, Art. 19.
76.
Nunn (2014).
77.
McGrath v Dawkins and Amazon, [2012] EWHC B3 (QB), para. 3.
78.
Ibid, para. 4 and 5.
79.
Ibid, para. 13 and 14.
80.
Ibid, para. 42.
81.
Ibid, para. 47.
82.
Nunn, Internet service providers: copyright infringement (n375).
83.
Art. 16(1) L.D. 70/03, quoting Bellan (2012), at 90.
84.
Ibid.
85.
Ibid. More details will be discussed in the chapter “notice-and-takedown procedure in the US, EU and China.”.
86.
Bellan, ‘Intellectual Property Liability of Consumers, Facilitators, and Intermediaries: The Position in Italy’ (n83), at 112.
87.
L’Oréal SA and Others v eBay International AG and Others (n12), at para. 120.
88.
Ibid, at para. 121 and 122.
89.
E-commerce Directive (n1), Art. 15.
90.
In other member states, notices also play a vital role in resulting in hosting ISPs’ knowledge of infringing materials. See Verbiest et al. (2007).
91.
See Internet Provisions (网络条例) (n25), Art. 13.
92.
Hua Xia Shu Ren v. Youku.com (华夏树人v.优酷), Beijing Haidian District Court (北京市海淀区法院), No. 9200 Hai Min Chu Zi (2008) ((2008)海民初字第9200号).
93.
See Io Group, Inc. v. Veoh Internets, Inc. (n34), at 1149. In the decision, the court did not directly conclude that the clip qualified for “red flag”, but it can be implied from the phrasing: “Although one of the works did contain the plaintiff’s trademark several minutes into the clip, there is no evidence from which it can be inferred that Veoh was aware of, but chose to ignore, it.”.
94.
Wang (2008).
95.
See Internet Provisions (网络规定) (n25), Art. 12.
96.
“hot-play” is a term that can always be found in the decisions made by Chinese courts, and finally was incorporated into the Provisions by the People’s Supreme Court. In terms of relevant decisions, “hot-play” has always been used to describe the audio-video works which are newly distributed, popular and still on screen.
97.
See Internet Provisions (网络规定) (n25), Art. 9.
98.
Ibid, Art. 10.
99.
E-commerce Directive (n1), Recital 45.
100.
DMCA (n1), Sec. 512 (i) (1) (A).
101.
See Perfect 10, Inc. v. CCBill, LLC, 340 F.Supp.2d 1077 (C.D. Cal. 2004), at 1090. This opinion has been upheld by 9th Circuit Court in the appealing instance; see Perfect 10, Inc. v. CCBill LLC (n37), at 1113.
102.
Ibid.
103.
See Ellison v. Robertson, 357 F3d 1072, at 1080 (9th Cir, 2004).
104.
See Perfect 10, Inc. v. CCBill LLC (n37), at 1113.
105.
See Perfect 10, Inc. v. CCBill, LLC (n101), at 1090.
106.
Ibid, at 1093.
107.
Ibid, at 1089.
108.
Corbis Corp. v. Amazon.com, Inc. (n34), at 1103. See also Io Group, Inc. v. Veoh Internets, Inc. (n34), at 1143–1145.
109.
Ibid.
110.
In re Aimster Copyright Litigation (n66), at 655.
111.
Viacom International, INC. v. YouTube, INC. (n10), at 41.
112.
Ibid.
113.
Ibid.
114.
Ibid.
115.
Ibid.
116.
Directive 2001/29/EC, Art. 8(3).
117.
Ibid, Recital 59.
118.
Directive 2004/48/EC, Art. 11.
119.
Ibid, Art. 3.
120.
L’Oréal SA and Others v eBay International AG and Others (n12), at para. 125–134.
121.
Ibid, para. 139.
122.
Ibid, para. 144.
123.
German Copyright Act, Sec. 97 (1).
124.
Leistner M, ‘Grundlagen und Perspektiven der Haftung für Urheberrechtsverletzungen im Internet’, 2012 ZUM 731.
125.
Ibid, at 724.
126.
Sharehoster II, 2010 MMR 51, at 53 (quoting Matulionyte and Nérisson (2011), at 66).
127.
Rapidshare, 2010 MMR 483, at 484 (quoting Matulionyte and Nérisson (2011), at 66–67).
128.
Leistner, ‘Grundlagen und Perspektiven der Haftung für Urheberrechtsverletzungen im Internet’ (n124), at 725.
129.
Ibid.
130.
Ibid.
131.
BGH, August 15, 2013, No. I ZR 80/12—Rapidshare, Para. (b).
132.
“link collections” means the collections of search results after searching for specific content through search tools. For instance, if a person searches keywords of “alone in dark, Rapidshare” in Google, the results are links from which a person can download “alone in dark” residing on Rapidshare.
133.
BGH—Rapidshare (n131), Para (c).
134.
Parti and Marin (2013).
135.
Ibid.
136.
Angelopoulos C (2013), at 264.
137.
Ibid.
138.
Ibid.
139.
Parti and Marin, ‘Ensuring freedoms and protecting rights in the governance of the Internet: a comparative analysis of blocking measures of illegal Internet content and the liability of ISPs’ (n134), at 149. In the case of Scarlet Extended SA v SABAM, the European Court of Justice stated, that Member States must not put ISPs under any obligation to endorse illegal police activities and thus providing surveillance of users. The ECJ also ruled that national court's order to force ISPs to implement filter systems, installed at ISPs' own expense and used for an unlimited period of time, would breach the ISPs’ rights to conduct business freely, and would infringe individuals’ rights to privacy and personal data protection. See Case C-70/10, Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (‘SABAM’) [2011] ECR I-11959
140.
Angelopoulos, ‘Beyond the Safe Harbours: Harmonising Substantive Intermediary Liability for Copyright Infringement in Europe’ (n136), at 265.
141.
Ibid.
142.
Ibid.
143.
Decision of the Court of Rome of July 11, 2011, quoting Coraggio G, ‘Google's victory might be a short success’ (2012) 23 Entertainment Law Review 139, at 140.
144.
Ibid.
145.
Ibid. In the case of Scarlet Extended SA v SABAM, the ECJ held that “must be interpreted as precluding an injunction made against an internet service provider which requires it to install a system for filtering … which is capable of identifying on that provider’s network the movement of electronic files containing a musical, cinematographic or audio-visual work in respect of which the applicant claims to hold intellectual-property rights, with a view to blocking the transfer of files the sharing of which infringes copyright.” See Scarlet Extended SA v SABAM (n139).
146.
Coraggio (2014).
147.
Content ID is an anti-piracy system run by YouTube and it can be used to filter out the copyrighted materials by reference files, see How Content ID works, available at https://support.google.com/youtube/answer/2797370?hl=en (last visited 18-06-2015).
148.
Spedicato (2014).
149.
How Content ID works (n147).
150.
Coraggio, YouTube case changes rules on Internet liability (n146).
151.
Ibid.
152.
UK Copyright, Designs and Patents Act 1988, Sec. 97A(1).
153.
Ibid, Sec. 97A(2).
154.
Twentieth Century Fox Film Corp v Newzbin Ltd., [2010] EWHC 608 (Ch), Para. 134, 135. In this case, although the defendant denied that it had actual knowledge of any person using its service to infringe, because it did not receive any notice from the plaintiff, the court still held that the defendant acquired the actual knowledge prescribed in Section 97A.
155.
Twentieth Century Fox Film Corp v. British Telecommunications Plc, Royal Courts of Justice, [2011] EWHC 1981 (Ch). Para. 153–156.
156.
Ibid.
157.
Twentieth Century Fox Film Corp v. Newzbin Ltd. (n154), Para. 135.
158.
Angelopoulos, ‘Beyond the Safe Harbours: Harmonising Substantive Intermediary Liability for Copyright Infringement in Europe’ (n136), at 265.
159.
Coraggio, YouTube case changes rules on Internet liability (n146).
160.
M. Leistner, ‘Grundlagen und Perspektiven der Haftung für Urheberrechtsverletzungen im Internet’, (n124), at 725.
161.
Matulionyte and Nérisson, ‘The French Route to an ISP Safe Harbor, Compared to German and US Ways’ (n126), at 66.
162.
National People’s Congress (全国人民代表大会), General Principles of the Civil Law of the People’s Republic of China (中华人民共和国民法通则), Order No. 37 of the president of the People's Republic of China (中华人民共和国第37号主席令), Art. 134. The legislators in China used Art. 1004 of German Civil Law as an important reference, which provides that “If the ownership is interfered with by means other than removal or retention of possession, the owner may require the disturber to remove the interference. If further interferences are to be feared, the owner may seek a prohibitory injunction”, when drafting Art. 134. This kind of “störerhaftung” has also been reaffirmed by the newly-adopted China Tort Law in Art. 15.
163.
Yinian v. Taobao (衣念v.淘宝), Shanghai First Intermediate People’s Court (上海市第一中级人民法院), No. 40 Hu Yi Zhong Min Wu (Zhi) Zhong Zi (2011) ((2011)沪一中民五(知)终字第40号). This case was published in the Bulletin of People’s Supreme Court (Vol. 1, 2012) as a guiding case.
164.
Han Han is one of most distinguished young writers who has many fans in China, and in May 2010, he was named one of most influential people in the world by Time magazine. The other party, Baidu, can be seen as the Chinese Google, and is one of the most successful internet companies in China. Therefore, the dispute between these two parties attracted considerable attention and, finally, this case was selected as one of ten annual IP cases (2012) by the People’s Supreme Court.
165.
Han Han v. Baidu (韩寒v.百度), Beijing Haidian District Court (北京市海淀区法院), No. 5558 Hai Min Chu Zi (2012) (2012海民初字第5558号) .
166.
Ibid.
167.
Ibid.
168.
Internet Provisions (n25) (Draft) (网络规定(草案)), Art. 8 (6).
169.
See Internet Provisions (网络规定) (n25), Art. 9 (6).
170.
Opinion of Advocate General, L’Oreal v. eBay International AG, case C-324/09, Para. 182. In this case, the AG first admitted that nothing in Directive 2004/48 would prohibit injunctions against the intermediary requiring not only the prevention of the continuation of a specific act of infringement but also the prevention of repetition of the same or a similar infringement in the future if such injunctions are available under national law. However, he also emphasized legal certainty and that an injunction should not impose impossible, disproportionate or illegal duties such as a general obligation to monitor. He concluded that an appropriate limit for the scope of injunctions may be that of a double requirement of identity.
171.
See Han Han v. Baidu (韩寒v.百度) (n165).
172.
Ibid.
173.
See Io Group, Inc. v. Veoh Internets, Inc. (n34), at 1143.
174.
Ibid.
175.
During a workshop about “video-sharing website’s secondary liability” held in the Center for Studies of Intellectual Property Rights of Zhongnan University of Economics and Law, the former legal director, Mr. Guangliang Cai delivered an introduction about the anti-piracy measures adopted by Tudou, which covered the database of black content. The relevant statement can also be found in Tudou’s copyright policy from its website, see http://www.tudou.com/about/cn/copyright.html.
176.
See Gershwin Publishing Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159 (2d Cir. 1971), at 1162.
177.
See DMCA (n1), Sec. 512 (c)(1)(B). According to this Article, if a hosting ISP wants to be exempted from secondary liability, it should not receive a financial benefit directly attributable to the infringing activity, in a case in which the service provider has the right and ability to control such activity.
178.
Congress, U.S., House Report 105-796 (1997–1998) (thereafter H.R. Conf. Rep. No. 105-796), at 73.
179.
Costar Group Inc. v. Loopnet, Inc., 164 F. Supp. 2d 688, at 704 (D. Md. 2001).
180.
See Perfect 10, Inc. v. CCBill LLC (n37), at 1117.
181.
Costar Group Inc. v. Loopnet, Inc., 373 F.3d 544, (4th Cir. 2004), at 555.
182.
See UMG Recording, Inc. V. Veoh Internet, Inc. (n36), at 1042–1045. In this case, the plaintiff UMG is a recording company which has copyright over considerable amounts of music, some of which was uploaded onto the defendant’s running video-website Veoh, so the plaintiff sued Veoh for copyright infringement.
183.
See H.R. REP. 105-551(II) (n30), at 54.
184.
Ibid.
185.
See Costar Group Inc. v. Loopnet, Inc. (n179), at 720. In this case, the court held that it would not be considered as a direct financial benefit “where the infringer makes the same kind of payment as non-infringing users of the provider’s service”.
186.
See Perfect 10, Inc. v. CCBill LLC (n37), at 1117; see Io Group, Inc. v. Veoh Internets, Inc. (n34), at 1150. This standard can be traced to the classic case of Fonovisa v. Cherry Auction (76 F.3d 259, at 264 (9th cir. 1996)). In this case, the Ninth Circuit held that the sale of pirate recordings in a Cherry Auction swap meet is a “draw” for customers, so the defendant who ran this swap meet directly benefited from infringements.
187.
Ibid, Perfect 10, Inc. v. CCBill LLC (n37), at 1118. In this case, the defendant, CWIE, hosted websites for a fee, and some of these websites included content which infringed the plaintiff’s copyright. First, the Ninth Circuit held that the defendant’s hosting of websites for a fee was not sufficient to prove the infringements functioning as a “draw” in the context of vicarious liability. Further, by noting that “receiving a one-time set-up fee and flat, periodic payments for service from a person engaging in infringing activities would not constitute receiving a ‘financial benefit directly attributable to the infringing activity’”, the Ninth Circuit held that the hosting fee received by the defendant was not directly attributable to infringements.
188.
Io Group, Inc. v. Veoh Internets, Inc. (n34), at 1150.
189.
See Viacom International, INC. v. YouTube, INC. (n51), at 517. In this case, the court held that in any event the provider must know of the particular case before he could control it. This interpretation of “control” has been overruled by the appeal court, which specified that “control” has nothing to do with hosting ISPs’ “item-specific” knowledge of infringements. See Viacom International, INC. v. YouTube, INC. (n10), at 36–38.
190.
A decision made by the District Court of S.D. New York was an exception, and in this case the court held that “the ability to block infringers' access to a particular environment for any reason whatsoever is evidence of the right and ability to supervise.” See Arista Records LLC v. Usenet.com, Inc., 633 F.Supp.2d 124, at 157 (S.D.N.Y.2009).
191.
See Viacom International, INC. v. YouTube, INC. (n10), at 36–38. In this case, the court summarized all decisions about the control provision in the DMCA 512 (c)(1)(B), and concluded that the prior case law completely agreed with the opinion that the control provision required something more than the “ability to remove or block” the hosted content.
192.
According to the “notice-and-takedown” mechanism, once a hosting ISP receives a competent notice about infringing content, it should expeditiously remove or disable access to material alleged to be infringing. Therefore, the DMCA 512 has already implied that a qualified hosting ISP should have the right and ability to remove or disable access to materials posted on its website. A similar analysis can also be found in the relevant US case law. For example, in the case of Hendrickson v. Ebay Inc., the Court stated that: “Congress could not have intended for courts to hold that a service provider loses immunity under the safe harbor provision of the DMCA because it engages in acts that are specifically required by the DMCA.” See Hendrickson v. Ebay Inc., 165 F. Supp. 2d 1082, at 1093–1094. (C.D. Cal. 2001).
193.
See Viacom International, INC. v. YouTube, INC. (n10), at 38.
194.
See Perfect 10, Inc. v. Cybernet Ventures, Inc., 213 F. Supp. 2d 1146, at 1173 (C.D. Cal. 2002). In this case, the Cybernet ran a web-service called “Adult Check”, and the plaintiff, Perfect 10, was a corporation owning copyright over considerable pornographic content. During the hearing, the court was unsure about whether Cybernet was a qualified ISP. However, the court held that even with the assumption of Cybernet’s qualification as an ISP, Cybernet could still not enjoy the shield of the “safe harbor” provision, because it failed to conform to the DMCA 512(c)(1)(B).
195.
See L’Oréal SA and Others v eBay International AG and Others (n12), at 1094.
196.
See Corbis Corporation v. Amazon.com, Inc. (n34), at 1110.
197.
Viacom International, INC. v. YouTube, INC. (n51), at 527. This conclusion has been overturned by the Appeal Court, since if setting the knowledge of specific items as a precondition of having right and ability to control, the DMCA 512(c)(1)(B) would be superfluous. “Any service provider that has item-specific knowledge of infringing activity and thereby obtains financial benefit would already be excluded from the safe harbor under § 512(c)(1)(A) for having specific knowledge of infringing material and failing to effect expeditious removal. No additional service provider would be excluded by § 512(c)(1)(B) that was not already excluded by § 512(c)(1)(A).” see Viacom International, INC. v. YouTube, INC. (n10), at 36.
198.
The detailed discussion can be found in the following Sect. 4.5.1. “inducement liability in US”.
199.
Peguera (2009), at 491.
200.
KG: Internetplattform zum Austausch von Fotodateien, 2010 MMR 203, at 204. The other three reasons are as follows: (1) in particular, the uploaded photographs went through a selecting and checking procedure before they were publicly accessible; (2) the copyright owners of the photographs were pointed out but in an unnoticeable and indiscreet way; (3) in the front part of the website, the corresponding philosophy of the operator was displayed under its logo, which was “publish modern and time-spiritual photos”.
201.
LG Hamburg: Haftung eines Plattformbetreibers—YouTube, 2010 MMR 833, at 834. The other reasons are as follows: (1) the logo of YouTube appeared on the upper right corner of videos because of a pre-designed website frame, when the downloadable videos were on play, but by contrast the signs or pseudonym of the uploading-users were very small and appeared on a separate part of the website apart from the videos; (2) the defendant sorts the uploaded videos into different categories, and when a video is clicked, the similar videos will show up on the right side of the webpage automatically; (3) YouTube requires the up-loaders to grant it the right to use these videos.
202.
BGH: Verwendung fremder Fotografien für Rezeptsammlung im Internet—marions-kochbuch.de, 2010 NJW-RR 1276, at 1276–1278. Case reference: BGH, Urteil vom 12. 11. 2009—I ZR 166/07. In this case, the defendant operated a website called chefkoch.de for the public to upload cooking recipes and corresponding photographs and the plaintiff ran a website called marions-kochbuch.de which introduced cooking recipes with relevant pictures. The plaintiff found that some of his copyrighted cooking instructions had been uploaded to the defendant’s website, so he launched a suit against the defendant for copyright infringement.
203.
Ibid, at 1276.
204.
Copyright owners, as the victims, commonly believe that it is unfair for hosting ISPs to benefit from large number of visits attracted by the contents copyrighted by them.
205.
Nérisson, ‘Intellectual Property Liability of Consumers, Facilitators, and Intermediaries: The Position in France’ (n72), at 79.
206.
Matulionyte and Nérisson, ‘The French Route to an ISP Safe Harbor, Compared to German and US Ways’ (n126), at 58. Case reference: First Civil Division of the Supreme Court, 14 January 2010, Case No. 06-18855, 2010 Bull. civ. I, No. 8. In this case, profiting from selling ad space was just one reason to hold Tiscali as a publisher, and the other reason is allowing users to establish their personal pages. See discussion in the previous chapter.
207.
Workman (2014).
208.
Nérisson, ‘Intellectual Property Liability of Consumers, Facilitators, and Intermediaries: The Position in France’ (n72), at 79.
209.
Ibid.
210.
Blocman (2011).
211.
Bellan, ‘Intellectual Property Liability of Consumers, Facilitators, and Intermediaries: The Position in Italy’ (n83), at 108.
212.
Bonadio & Santo, ‘Court of Milan holds video sharing platforms liable for copyright infringement’ (n239), at 15.
213.
Bellan, ‘Intellectual Property Liability of Consumers, Facilitators, and Intermediaries: The Position in Italy’ (n83), at 110.
214.
Decision of the Court of Milan of January 20, 2011 No.27079/09, quoting Coraggio, ‘Google's victory might be a short success’ (n143), at 139–140.
215.
Bellan, ‘Intellectual Property Liability of Consumers, Facilitators, and Intermediaries: The Position in Italy’ (n83), at 111–112.
216.
Coraggio, ‘Google's victory might be a short success’ (n143), at 140.
217.
Spedicato, ‘Italy: the take-down notice must contain the specific YouTube URLs’ (n148).
218.
Google France SARL and Google Inc. v Louis Vuitton Malletier SA and Others (n12), at para. 116.
219.
Opinion of Advocate General, Google France SARL and Google Inc. v Louis Vuitton Malletier SA and Others, joined cases C-236/08-C-238/08, at para. 339.
220.
BuSheng v. YoBo (步升v.友播), Beijing Haidian District Court (北京市海淀区法院), No. 6939 Hai Min Chu Zi(2008) ((2008)海民初字第6939号). In this case, the plaintiff BuSheng owned copyright of certain musical works, some of which had been uploaded to the defendant’s websites by Internet users, so the plaintiff sued YoBo for copyright infringement.
221.
CiWen v. 56.com (慈文v.56网), Beijing Second Intermediate People’s Court (北京市第二中级人民法院), No. 9 Er Zhong Min Zhong Zi (2008) ((2008)二中民终字第9号). In this case, a television series call “Jia” (Family) owned by the plaintiff CiWen had been uploaded to the defendant’s website “56.com” without permission, so the plaintiff sued “56.com” for copyright infringement.
222.
joy.cn v. 56.com (激动网v.56网), Beijing Haidian District Court (北京市海淀区法院), No. 24750 Hai Min Chu Zi (2008) ((2008)海民初字第6939号). In this case, some copyrighted videos owned by the plaintiff “Joy.cn” had been uploaded to the defendant’s website “56.com” without permission, so the plaintiff sued “56.com” for copyright infringement.
223.
joy.cn v. 6room.com (激动网v.六房间) (n222).
224.
This Guiding Opinions (n229) is not a mandatory legal document, because unlike the People’s Supreme Court in China, the Beijing Higher People’s Court has no statutory rights to promulgate any judicial interpretation of general application. However, Beijing, as one of the two cities (the other is Shanghai) hearing most of the disputes about Internet copyright infringement in China, the courts there always take a lead in solving these disputes and have accumulated considerable judicial experience in this respect. Therefore, the Guiding Opinions provided by the Beijing Higher People’s Court definitely has widespread influence in China and will be used as an important reference by other courts.
225.
Ibid, Art. 24 (3).
226.
See Internet Provisions (网络规定) (n25), Art. 11.
227.
Google France SARL and Google Inc. v Louis Vuitton Malletier SA and Others (n12), at para. 116.
228.
MGM Studios Inc. v. Grokster Ltd., 545 U.S. 913, at 942 (2005).
229.
Ibid, at 913.
230.
Arista Records LLC. v. Lime Group LLC, 784 F. Supp. 2d 398, at 424 (S.D.N.Y. 2011). This is a case against p2p software, and since running p2p software is not a typical internet service covered by “safe harbor” provision, the court need not discuss the relationship between inducement liability and the “safe harbor” provision.
231.
Columbia Pictures Industries, Inc. v. Gary FUNG, 2009 WL 6355911 (C.D. Cal.), at 1.
232.
Ibid.
233.
Ibid, at 9–15. In this case, the defendant, Fung, ran several websites which would “collect, receive, index, and make available descriptions of content, including so-called ‘dot-torrent files,’ and would also provide access to ‘open-access’ BitTorrent Trackers.” Consequently, the district court denied treating the defendant’s service as a transitory digital Internet communication or host rather than an information location tool. However, the court made a clear statement about the relationship between inducement liability and the “safe harbor” provision, so it is still relevant to the discussion here. Moreover, in the appeal instance, the 9th Circuit held that the defendant could be seen as a hosting ISP.
234.
Ibid, at 18.
235.
See Reese (2011).
236.
See Columbia Pictures Industries, Inc. v. Gary FUNG, 710 F.3d 1020, at 1032–1037 (9th Cir. 2013).
237.
Ibid, at 1040.
238.
Ibid.
239.
Ibid, at 1047.
240.
Ibid, at 1043.
241.
Ibid.
242.
Ibid.
243.
Ibid. In this case, the 9th Circuit Court was still not entirely confident about “red flag” knowledge already being fulfilled, for the reason that it was uncertain whether exclusion from the § 512(c) safe harbor because of actual or “red flag” knowledge of a specific infringing activity applied only with regard to liability for that infringing activity, or more broadly.
244.
Ibid, at 1045.
245.
Ibid.
246.
See Internet Provisions (网络规定) (n25), Art. 7.
247.
Beijing High People’s Court (北京市高级人民法院), Guide for Hearing Copyright Disputes involving Video-sharing (视频分享著作权纠纷案件的审理指南), JingGaoFaFa[2012] No. 419 (京高法发[2012]419号), Art. 3.
248.
chineseall.com v. 178.com (北京中文在线v.北京智珠网络技术), Beijing Chaoyang District Court (北京市朝阳区人民法院), No. 8854 Chao Min Chu Zi (2013) ((2013)朝民初字第8854号).
249.
In terms of the Provisions promulgated by People’s Supreme Court, once the inducing infringement has been concluded, “safe harbor” provisions are not applicable anymore.
250.
See MGM Studios Inc. v. Grokster (n228), at 913.
251.
See chineseall.com v. 178.com (北京中文在线v.北京智珠网络技术) (n248).
252.
Sterling, JAL (2008), at 629.
253.
Credit Lyonnais Bank Nederland NV v. Export Credits Guarantee Dept [1998] 1 Lloyd’s Rep 19, at 46.
254.
Twinsectra Limited v. Yardley and Others [2002] UKHL 12, para. 112.
255.
Ibid. In light of Lord Millet’s understanding, Nelsonian knowledge amounts to actual knowledge.
256.
L’Oréal SA and Others v eBay International AG and Others (n12), para. 123.
257.
See what has been discussed in Section “Störerhaftung—disturber’s liability in Germany”.
258.
Perfect 10, Inc. v. RapidShare, Perfect 10, Inc. v. RapidShare, No. 09-CV-2596 H (S.D. Cal., 2010).; see BGH—Rapidshare (n131), at 1.
259.
Ibid, at 6–11.
260.
BGH—Rapidshare (n131), para. (b).
261.
Ibid, para. (c), para. 21.
262.
Spitz and Avocats (2012).
263.
SPPF is the short name for Société des Producteurs de Phonogrammes de France, and SCPP is the short name for Société Civile des Producteurs Phonographiques. Both of them are copyright collective management organization in France, and in this case, a large amount of music managed by them was made accessible to the public without authorization through the defendant’s service.
264.
M. Louvel, P.; Mme Radenne, J. (Rapporteur), M. Arnould J., Mubility (Societe) v. Societe Des Producteurs De Phonogrammes En France (Sppf) (As Civil Parties), [2013] E.C.C. 22, 229. 235.
265.
Ibid, at 232.
266.
Ibid, at 236.
267.
Ibid, at 232–236.
268.
Ibid, at 235.
269.
Ibid, at 236.
270.
Twentieth Century Fox Film Corp v. Newzbin Ltd. (n154).
271.
Ibid, para. 1 to para. 4.
272.
Ibid, para. 6, para. 10.
273.
Ibid, para. 10.
274.
Ibid, para. 13.
275.
Ibid, para. 23–27.
276.
Ibid, para. 27.
277.
Ibid, para. 29.
278.
Ibid, para. 79, 37, 49 and 50.
279.
Ibid, para. 90.
280.
Ibid, para. 98.
281.
Ibid, para. 99.
282.
Ibid, para. 100.
283.
Ibid, para. 101.
284.
Ibid, para. 103.
285.
Ibid, para. 108.
286.
Ibid, para. 111.
287.
Shillito and Meale (2010).
288.
See MGM Studios Inc. v. Grokster (n228), at 913.
289.
See chineseall.com v. 178.com (北京中文在线v.北京智珠网络技术) (n248).
290.
The “original” here means the videos made by amateur Internet users rather than professional producers.
291.
This kind of division can be found on nearly all main video-sharing websites in China, such as “youku.com”, “tudou.com”, and “video.sina”.
292.
nubb.com v. Tudou.com (新传在线v.土豆网), Shanghai High People’s Court (上海市高级人民法院), No. 62 Hu Gao Min San (Zhi) Zhong Zi (2008) ((2008)沪高民三(知)终字第62号).
293.
GuanShi Culture v. 6room.com (观视文化v.六房间), Beijing Haidian District Court (北京市海淀区法院), No. 31332 Hai Min Chu Zi (2008) ((2008)海民初字第31332号). The HaiDian District Court also drew a similar conclusion in another case “GuanDianWeiYe v. Youku.com”, see No. 14023 Hai Min Chu Zi (2008).
294.
See Internet Provisions (网络规定) (n25).
295.
Art. 9 and 12 of the Provision list some instances where service providers should be presumed to “should know the infringements”, and these two articles end with “other factors” to be considered, which leaves lower courts enough room to make their own judgments.
296.
See Guide (指南) (n247), Art. 7(1).
297.
vale.com v. Tudou.com (网络互联v.土豆网) (n320). In another case—nubb.com v. Tudou.com, the Shanghai Higher People’s Court made a similar statement on protecting “hot-play movies”, see nubb.com v. Tudou.com (新传在线v.土豆网) (n292).
298.
See Han Han v. Baidu (韩寒v.百度) (n165).
299.
JiaHua Culture v. 56.com (佳华文化v.56网), Beijing Chaoyang District Court (北京朝阳地区法院), No.20595 Chao Min Chu Zi (2013) ((2013)朝民初字第20595号).
300.
See Internet Provisions (网络规定) (n25), Art. 12.
301.
See Guiding Opinions (指导意见) (n229), Art. 19(1). According to Article 19(1), where the alleged infringing content includes hot-play audio-video works, popular music works or other types of well-known works, or the performances and audio-video products, and this content is located on the homepages, other main pages or other pages which can be obviously accessed by service providers, then the hosting ISPs should be presumed to know about this infringing content.
302.
See Guide (指南) (n247), Art. 8(1).
303.
The courts in Beijing have jurisdiction over most copyright disputes on the Internet, so the Guiding Opinion issued by Beijing Higher People’s Court strongly affects cases about hosting ISPs’ liability.
304.
ZhongQinWen v. Baidu (中青文v.百度), Beijing First Intermediate People’s Court (北京市第一中级人民法院), (2013)YiZhongMinChuZi, No. 11912 ((2013)一中民初字第11912号).
305.
Ibid.
306.
Ibid.
307.
Ibid.
308.
Ibid.
309.
ZhongQinWen v. Baidu (中青文v.百度), Beijing High People’s Court (北京市高级人民法院), 2014 GaoMinZhongZi, No. 2045, ((2014)高民终字第2045号).
310.
In some jurisdictions including the US, France and the UK, a hosting ISP is held to know infringement, if it induces or intentionally facilitates the infringement. See Sect. 4.5.1 and 4.5.3.
311.
See Sect. 4.5.1 “inducement liability in the US”.
312.
See Sect. 4.5.2 “inducing infringement in China” and the Germany part in Sect. 4.5.3 “intent to facilitate infringement in the EU.”.
313.
MGM Studios Inc. v. Grokster (n228), at 942.
314.
As being discussed in Sect. 4.5.2, a Chinese court held BBS operator as inducer because it had a policy of rewarding these subscribers who uploaded content or replied to such content with virtual “silver coins.” Further, as has been discussed in Sect. 4.5.3, in Germany, the Federal Court of Justice held that Rapidshare needed to undertake “Disturber’s liability” because its commercial model substantially induced large scale infringements.
315.
Högberg (2006).
316.
According to the Grokster decision, “suspect” product design alone does not give rise to inducement liability under Grokster. See MGM Studios Inc. v. Grokster (n228), at 938.
317.
Reese RA, ‘The Relationship Between the ISP Safe Harbors and Liability for Inducement’ (n235), at 6.
318.
Columbia Pictures Industries, Inc. v. Gary FUNG (n236), at 1032–1037. In this case, the court held Fung’s business model as supportive evidence to conclude inducement infringement. Further, some technical features of Fung’s service can promote copyright infringement, such as implement “spider” program that allows users to locate and obtain copies of dot.torrent files, but the 9th Circuit did not take it as a reason to hold Fund as an inducer.
319.
See chineseall.com v. 178.com (北京中文在线v.北京智珠网络技术) (n248).
320.
Ibid.
321.
Germany: “Rapidshare III”—Telemedia Act secs.7(2), 10 (2014), 45 International Review of Intellectual Property and Competition Law 716, at 716.
322.
Sony Corp. v. Universal City Studios, Inc. (n4), at 442.
323.
Lemley and Reese (2004), at 1356.
324.
Ibid, at 1356.
325.
MGM Studio, Inc v. Grokster Ltd., 380 F.3d 1154, at 1162 (9th Cir. 2004).
326.
Sony Corp. v. Universal City Studios, Inc. (n4), at 442.
327.
Lemley and Reese, ‘Reducing digital copyright infringement without restricting innovation’ (n323), at 1356.
328.
Jane C. Ginsburg, (2001), at 1613–1614.
329.
Lemley and Reese, ‘Reducing digital copyright infringement without restricting innovation’ (n323), at 1387.
330.
Sony Corp. v. Universal City Studios, Inc. (n4). In this case, copyright industry tried to persuade the US Supreme Court to ban the sale of VCRs produced by Sony, but finally the US Supreme Court created the “substantial non-infringing use” doctrine, which confirmed the legality of selling VCRs.
331.
Lemley and Reese, ‘Reducing digital copyright infringement without restricting innovation’ (n323), at 1387.
332.
According to a series of self-regulation documents signed between hosting ISP and copyright owners, hosting ISPs share their profits with copyright owners. See Sect. 8.2 in Chap. 8.
333.
See repeat infringer policy, disturber’s liability and notice-and-staydown discussed above in Sect. 4.3.
334.
See DMCA (n1), Sec. 512 (m) (1), E-commerce Directive (n1), Art. 15.
335.
Io Group, Inc. v. Veoh Internets, Inc. (n34), at 1143–1145.
336.
Matulionyte and Nérisson, ‘The French Route to an ISP Safe Harbor, Compared to German and US Ways’ (n126), at 66.
337.
Germany: Teleservices Act, secs.8(2),11; EU E-commerce Directive, Arts.14(1) and (2); Trade Mark Act, sec.14(2),(3) and (4)—"internet auction" (Internet-Versteigerung)’ (2005) 36 International Review of Intellectual Property and Competition Law 573, at 573.
338.
BGH—Rapidshare (n131), Para. 53.
339.
Angelopoulos, ‘Beyond the Safe Harbours: Harmonising Substantive Intermediary Liability for Copyright Infringement in Europe’ (n136), at 264.
340.
E-commerce Directive (n1), Recital 47.
341.
L’Oréal SA and Others v eBay International AG and Others (n12), para. 144.
342.
Angelopoulos, ‘Beyond the Safe Harbours: Harmonising Substantive Intermediary Liability for Copyright Infringement in Europe’ (n136), at 265.
343.
Jasserand C (2013).
344.
Schellekens M (2011).
345.
Ibid, at 163.
346.
SABAM v. Netlog (n12), para 44–46.
347.
Lemley MA (2007), at 101.
348.
L’Oréal SA and Others v. eBay International AG and Others (n12), para. 140.
349.
How Content ID works (n147).
350.
Holland et al. (2014).
351.
Sawyer MS (2009), at 366. In part III of this article, Sawyer made a detailed analysis on why filtering technologies cannot accommodate fair use.
352.
Fair Use Principles for User Generated Video Content, Electronic Frontier Foundation (2007), available at https://www.eff.org/pages/fair-use-principles-user-generated-video-content (last visited 28-07-2014).
353.
Scarlet Extended SA v SABAM (n139), para. 26.
354.
In the case of Io Group, Inc. v. Veoh Internets, Inc., the court held the similar opinion. In this case, the defendant Veoh adopted filtering technologies to prevent the same infringing materials from being uploaded again, so the court took this effort as a reason to exempt Veoh from liability. See Io Group, Inc. v. Veoh Internets, Inc. (n34), at 1143.
355.
See what has been discussed in Sect. 4.6.
356.
See the cases discussed in Sect. 4.6.
357.
nubb.com v. Tudou.com (新传在线v.土豆网) (n292).
358.
Han Han v. Baidu (韩寒v.百度) (n165).
359.
See the Fung case, Rapidshare case and Newzbin case discussed above. The hosting services in these cases either aimed at promoting infringing use, or were widely used for infringing purpose.
360.
Ruse-Khan (2015). As noted in this article, the conflicts between intellectual property protection and other rights have become quite frequent, which has aroused lots of discussion among academics.
361.
See Lemley and Reese, ‘Reducing digital copyright infringement without restricting innovation’ (n323), at 1349. See also SABAM v. Netlog (n12), para. 44–46; Scarlet Extended SA v SABAM (n139), para. 26.
362.
Lichtman and Landes (2003), at 401.

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KoGuan School of Law, Shanghai Jiao Tong University, Shanghai, China
Jie Wang

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Jie Wang
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Wang, J. (2018). Hosting ISPs’ Secondary Liability Under the Roof of “Safe Harbor” Provisions. In: Regulating Hosting ISPs’ Responsibilities for Copyright Infringement. Springer, Singapore. https://doi.org/10.1007/978-981-10-8351-8_4

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DOI: https://doi.org/10.1007/978-981-10-8351-8_4
Published: 20 March 2018
Publisher Name: Springer, Singapore
Print ISBN: 978-981-10-8350-1
Online ISBN: 978-981-10-8351-8
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