Netlitigation | Trademark

Trademark or Copyright Infringement on the Internet

Overview
Cases
DMCA
MP3
Background Notes

The doctrines of "contributory" and "vicarious" trademark or copyright infringement (see Background Notes)have been applied in two primary areas of Internet activity.

First, Network Solutions, Inc. has thus far avoided liability for registering domain names that allegedly infringed plaintiffs’ trademarks (Lockheed; AMPAS).

The second, and larger, group of cases involves liability arising from copyright infringement on bulletin board services ("BBS’s"). The Church of Scientology has twice been unsuccessful in obtaining preliminary injunctive relief against BBS’s which used copyrighted works by church founder L. Ron Hubbard in efforts to publicize criticism of the church (FACTNET; Netcom). The game manufacturer Sega has had better success obtaining relief against BBS’s that facilitate the copying of its games (Sabella; Maphia). The magazine publisher Playboy has succeeded in having BBS providers held liable for direct, and not merely contributory, infringement (Frena; Hardenburgh). Finally, courts have signaled a willingness to extend the reasoning of the BBS cases to other kinds of Internet businesses (Marobie).

Cases

Lockheed Martin Corp. v. Network Solutions, Inc., 985 F.Supp. 949 (C.D. Cal. 1997)

The court held that NSI did not "use" the plaintiff’s trademark, as required for direct-infringer liability, by merely registering the mark as a domain name. Furthermore, NSI’s conduct did not qualify as contributory infringement, even though it knew of Lockheed’s claims that the domain names were infringing. The court concluded that "[b]ecause NSI’s involvement with potentially infringing uses of domain names is remote," it would be inappropriate to hold it liable for contributory infringement absent a showing of "unequivocal knowledge that a domain name was being used to infringe a trademark." Such knowledge did not exist in this case, the court held, given that the mark in question had numerous unprotected generic uses, and that NSI had little access to information from which it could discern whether the uses by domain-name registrants overlapped with Lockheed’s and were likely to cause consumer confusion.

Academy of Motion Picture Arts and Sciences v. Network Solutions Inc., 989 F.Supp. 1216 (C.D. Cal 1997)

The court found that NSI could not be liable for contributory infringement on the basis of its registering of domain names containing the terms "oscar" and "theoscars" to registrants not associated with the plaintiff Academy because NSI could exercise no control over, and had no knowledge of, the use of those domains by the registrants.

Religious Technology Center v. FACTNET, Inc., 901 F.Supp. 1519 (D. Colo. 1995)

The court suggested that the defendants would likely be able to show that the copying and posting on the Internet of the Church of Scientology’s works by their nonprofit organization was a "fair use."

Religious Technology Center v. Netcom On-Line Communication Services, 907 F.Supp. 1361 (N.D. Cal. 1995)

The Church of Scientology sued both the operators of a BBS and Internet access-provider Netcom. The court held that Netcom could not be held liable for direct infringement, since its role in the process of disseminating the allegedly infringing works was "not unlike that of the owner of a [public] copying machine." Netcom could also not be regarded as a vicarious infringer, since it may have had a "right to control" its subscribers, but there was no evidence that it had received a "direct financial benefit" from the infringement. However, the court concluded, Netcom might be held liable as a contributory infringer, since it continued to host the BBS (and thus, in the court’s view, "materially contributed to" its activities) after it had received notice of the church’s claim of infringement. The court made clear that liability might still be avoided if Netcom could establish a fair-use defense. Furthermore, given the unlikelihood that the infringement claim would ultimately succeed as to Netcom (or the BBS provider himself), the church was not entitled to a preliminary injunction.

Sega Enterprises Ltd. v. Sabella, 1996 WL 780560 (N.D.Cal. Dec. 18, 1996)

Sega obtained summary judgment and a permanent injunction based on a theory of contributory copyright infringement asserted against a BBS provider. The court concluded that the defendant had ample reason to know that her BBS was being used to copy Sega games--indeed, she had encouraged the activity and, as in the Netcom case discussed above, had "materially contributed to" the activity by providing the "site and facilities" for it, and more. Nor could she establish a fair-use defense, given the commercial and damaging nature of the copying.

Sega Enterprises Ltd. v. MAPHIA, 948 F.Supp. 923 (N.D. Cal. 1996)

In a decision issued the same day as the Sabella decision, the court similarly grants summary judgment to the plaintiff and issues a permanent injunction against a BBS operator where it was undisputed that the operator knew the board was being used to copy Sega's games and actively participated in that use by soliciting users to upload games and selling copiers to assist in the making of copies.

Playboy Enterprises, Inc. v. Frena, 839 F.Supp. 1552 (M.D. Fla. 1993)

The court found no meaningful distinction, for copyright-law purposes, between the conduct of BBS users in copying and uploading protected photographs, and the passive role played by the defendant BBS provider in facilitating the activity.

Playboy Enterprises, Inc. v. Russ Hardenburgh, Inc., 982 F.Supp. 503 (N.D. Ohio 1997)

The court was willing to acknowledge that direct infringement required some volitional act by a BBS provider, but found the necessary volition in the case before it, where the defendant provider had established an incentive program giving users downloading "credit" for photographs they uploaded, and where the defendant’s employees had viewed and organized the uploaded materials.

Marobie-FL, Inc. v. National Association of Fire Equipment Distributors, 983 F.Supp. 1167 (N.D. Ill. 1997)

The court held both the proprietor of a World Wide Web site containing copies of infringing works and the operator of the website’s host computer could be held liable for the infringement, where there was some evidence that the host operator had knowledge of the infringing activity, and did nothing in response.

Brookfield Communications, Inc. v. West Coast Entertainment Corp.,Ninth Circuit Court of Appeals, April 22, 1999

Here, the Ninth Circuit upheld its earlier order granting a preliminary injunction in favor of the plaintiff, Brookfield, which precluded West Coast's use the term "moviebuff" for its "moviebuff.com" web site. The decision is notable for its rejection of West Coast's argument that it was the senior user of the mark because of its prior use of the mark and its registration of the domain name in 1996. In addition, the Court also held that West Coast could not use the term "moviebuff" as a metatag keyword.

For further discussion concerning the trademark-related portion of this decision see our in-depth analysis or, see our metatag page for our analysis of that portion of the holding.

To read the court's opinion click here.

Recording Industry Association of America v. Diamond Multimedia Systems Inc., Ninth Circuit Court of Appeals, Civil Action Number CV-98-08247-ABC, June 15, 1999

In a decision of June 15, 1999, the United States Court of Appeals for the Ninth Circuit held that the AHRA does not apply to music recorded through a computer. The Appeals Court reasoned that what occurs when a song is downloaded from a PC to the Rio is not the reproduction of a digital "musical recording," as required by the AHRA, but the reproduction of a computer hard-drive. Conceiving of a hard-drive as an indivisible whole, the Court reasoned that since a typical hard-drive contains many programs and databases unrelated to the reproduction of "sound," it could not be considered a "musical recording."

For further information about this case see our in-depth analysis. To read more about the MP3 controversy, see our overview.