Copyright Infringement Essentials – Understanding “Contributory Infringement” vs. “Vicarious” infringement

Introduction

This blog discusses what you need to know about a cause of action for “contributory” copyright infringement, which in essence is a type of “aiding and abetting” of infringing software, books, movies, films, videos, jewelry, literature, poems, art, photographs or other items.

What does it take to prove a copyright infringement case?

The first important point is to understand what copyright infringement is. As one federal court in the Northern District of California noted:

“To establish a claim of copyright infringement, a plaintiff must demonstrate:

(1) ownership of a valid copyright

and

(2) “copying” of protectable expression by the defendant.

See Baxter v. MCA, Inc., 812 F.2d 421, 423 (9th Cir.), cert. denied, 484 U.S. 954, 108 S.Ct. 346, 98 L.Ed.2d 372 (1987). Infringement occurs when a defendant violates one of the exclusive rights of the copyright holder. 17 U.S.C. § 501(a).

These rights include the right to reproduce the copyrighted work, the right to prepare derivative works, the right to distribute copies to the public, and the right to publicly display the work. 17 U.S.C. §§ 106(1)–(3) & (5).”

See Religious Tech. Ctr. v. Netcom On-Line Commc'n Servs., Inc., 907 F. Supp. 1361, 1366–67 (N.D. Cal. 1995)

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Federal Caselaw on Contributory Infringement

In Online Policy Grp. v. Diebold, Inc., 337 F. Supp. 2d 1195, 1199–200 (N.D. Cal. 2004), the Northern District Court in California discussed this legal concept:

“There is no statutory rule of liability for contributory infringement. However, courts recognize such liability when the defendant “with knowledge of the infringing activity, induces, causes or materially contributes to the infringing conduct of another.” Gershwin Pub. Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159, 1162 (2nd Cir.1971). “Such participation must be substantial.” Religious Tech. Ctr., 907 F.Supp. at 1361.

The party alleging contributory infringement must show:

(1) direct infringement by a primary infringer

(2) knowledge of the infringement,

and

(3) material contribution to the infringement.” See Metro–Goldwyn–Mayer Studios, Inc. v. Grokster Ltd., 380 F.3d 1154, 1160 (9th Cir.2004).

A defendant may be liable under a vicarious liability theory if the plaintiff demonstrates:

(1) direct infringement by a primary party,

(2) a direct financial benefit to the defendant, and the right and ability to supervise the infringers.”

This legal concept can pop up in virtually any type of copyright case including software audits where a company is accused of allowing contractors (that are performing work on behalf of the company under audit) to use infringing copies of Autodesk software or Microsoft or Adobe for example.

In another case from the ninth circuit – Religious Tech. Ctr. v. Netcom On-Line Commc'n Servs., Inc., 907 F. Supp. 1361, 1373 (N.D. Cal. 1995) the Court discussed:

Netcom is not free from liability just because it did not directly infringe on plaintiffs' works; it may still be liable as a  contributory infringer. Although there is no statutory rule of liability for infringement committed by others, [t]he absence of such express language in the copyright statute does not preclude the imposition of liability for  copyright infringement on certain parties who have not themselves engaged in the infringing activity. For 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. Sony Corp. v. Universal City Studios, Inc., 464 U.S. 417, 435, 104 S.Ct. 774, 785, 78 L.Ed.2d 574 (1984) (footnote omitted). Liability for participation in the infringement will be established where the defendant “with knowledge of the infringing activity, induces, causes or materially contributes to the infringing conduct of another.” Gershwin Publishing Corp. v. Columbia Artists Management, Inc., 443 F.2d 1159, 1162 (2d Cir.1971).

There must be a “substantial” contribution

Where a defendant has knowledge of the primary infringer's infringing activities, it will be liable if it “induces, causes or materially contributes to the infringing conduct of” the primary infringer.  Gershwin Publishing, 443 F.2d at 1162. Such participation must be substantial.  Apple Computer, Inc. v. Microsoft Corp., 821 F.Supp. 616, 625 (N.D.Cal.1993),  aff'd, 35 F.3d 1435 (9th Cir.1994);  Demetriades v. Kaufmann, 690 F.Supp. 289, 294 (S.D.N.Y.1988). See  Religious Tech. Ctr. v. Netcom On-Line Commc'n Servs., Inc., 907 F. Supp. 1361, 1375 (N.D. Cal. 1995).

Copyright Infringement by Selling Products that Induce infringement

“To prove copyright infringement on an inducement theory, Columbia also had to adduce “evidence of actual infringement by” users of Fung's services.  Grokster III, 545 U.S. at 940, 125 S.Ct. 2764. This they have done.  Both uploading and downloading copyrighted material are  infringing acts. The former violates the copyright holder's right to distribution, the latter the right to reproduction.  See 17 U.S.C. § 106(1) & (3);  Napster, 239 F.3d at 1014. Based on statistical sampling, Columbia's expert averred that between 90 and 96% of the content associated with the torrent files available on Fung's websites are for “confirmed or highly likely copyright infringing” material. Although Fung takes issue with certain aspects of the expert's methodology, he does not attempt to rebut the factual assertion that his services were widely used to infringe copyrights. Indeed, even giving Fung the benefit of all doubts by tripling the margins of error in the expert's reports, Columbia would still have such overwhelming evidence that any reasonable jury would have to conclude that the vastly predominant use of Fung's services has been to infringe  copyrights.  In sum, as in  Grokster III, “[a]lthough an exact calculation of infringing use, as a basis for a claim of damages, is subject to dispute, there is no question” that Plaintiffs have met their burden on summary judgment to warrant equitable relief.  Grokster III, 545 U.S. at 940–41, 125 S.Ct. 2764.

See Columbia Pictures Indus., Inc. v. Fung, 710 F.3d 1020, 1034 (9th Cir. 2013)

More federal caselaw from the Youtube case

For a claim of contributory copyright infringement, a plaintiff "must establish that there has been direct infringement by third parties" as a threshold matter. Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 1146, 1169 (9th Cir. 2007). Liability for contributory copyright infringement requires proof that a defendant: "'(1) has knowledge of another's infringement and (2) either (a) materially contributes to or (b) induces that infringement.'" VHT, 918 F.3d at 745 (quoting Perfect 10, Inc. v. Visa Int'l Serv. Ass'n, 494 F.3d 788,795 (9th Cir. 2007)). In the online context, material contribution means the defendant "'has actual knowledge that  [*8] specific infringing material is available using its system, and can take simple measures to prevent further damage to copyrighted works, yet continues to provide access to infringing works.'" Id. (quoting Perfect 10, Inc. v. Giganews, Inc., 847 F.3d 657, 671 (9th Cir. 2017)) (emphasis in original). "Inducement liability requires evidence of 'active steps ... taken to encourage direct infringement," such as "'advertising an infringing use or instructing how to engage in an infringing use.'" Id. (quoting Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913, 936, 125 S. Ct. 2764, 162 L. Ed. 2d 781 (2005)).  See Schneider v. YouTube, LLC, 2023 U.S. Dist. LEXIS 1878, *7-8

Contact a Software, IP & Copyright Law Firm

We have substantial experience handling federal copyright law matters dealing with infringed software, movies, jewelry, architectural plans, music and photos.  Contact us to discuss your case with an IP copyright attorney.  We can be reached at (877) 276-5084.  We offer flat rate legal fees for most non-litigation cases.  Vondran Legal® has also been identified by Unicourt.com as the #1 copyright infringement defense firm IN THE UNITED STATES for the years 2020, 2021 and we are waiting to hear on 2022.  This is in terms of number of copyright infringement cases handled.  In this niche area of copyright law, there is no substitute for experience.