Supreme Court Also Won't Hear Tiffany's Claim Against eBay

from the dumping-secondary-liability dept

We already noted that the Supreme Court has refused to hear Whitney Harper's innocent infringer case, but in a bit of better news, the Supreme Court has also decided not to hear Tiffany's appeal against eBay, concerning whether or not eBay was guilty of secondary trademark infringement in allowing counterfeit Tiffany goods to be sold on the site. The appeals court pointed out this made no sense, so it's good to hear that the Supreme Court won't upset that ruling -- especially since that ruling has been a key part of the Viacom/YouTube case, in showing that secondary liability shouldn't automatically be applied to third parties, even in the potential absence of legislative safe harbors. One of the concerns with various safe harbors that protect third parties from actions of their users is the implication that without those safe harbors, third parties are automatically liable. Yet, as the Tiffany case showed, some common sense should be applied. Third parties shouldn't be liable for actions of their users unless there's significant involvement by the third party in the infringement.

Filed Under: secondary liability, supreme court, trademark
Companies: ebay, supreme court, tiffany

How ACTA Turns Limited Secondary Liability In Copyright Into Broad Criminal Aiding & Abetting

from the uh-ohs dept

We've noted that one of the serious problems with ACTA is the fact that it locks in this idea of secondary liability in copyright law, making it such that third parties can be liable for actions of their users' infringement in certain cases. Secondary liability in copryight law is caselaw driven. Congress had a chance a few years back to put "inducement" into copyright law with the INDUCE Act, but chose not to. So I find it strange that the courts have simply interpreted copyright law to include such an inducement standard anyway. One of the problems with ACTA is that it takes this highly dynamic part of the law, and effectively locks it in, such that Congress cannot tell the courts it made a mistake, should it decide to do so.

However, some are noticing that it's actually even worse than that. While I already disagree with the court's interpretation of various forms of secondary liability, at least they've included some safeguards in terms of what standards need to be met before secondary liability might apply by looking at things like whether or not there are substantial non-infringing uses and whether or not there's intent or knowledge. Unfortunately, it looks like ACTA partly seeks to wipe these out by changing these more nuanced standards into a simple "aiding and abetting" standard, which could lead to criminal infringement claims. As we've already noted, ACTA has already broadened the definition of "commercial scale" in order to increase criminal liability for infringement, but law professor Michael Carrier's analysis suggests the "aiding and abetting" language also greatly broadens the liability for secondary liability as well:

Any party that plays a role in assisting infringement could be liable for criminal liability. The identity of such parties is worrisome: Personal computer manufacturers. Electronic device makers. Search engine operators. Each of these entities could play a role, however indirect, in contributing to copyright infringement.

Although copyright's secondary liability law is not a model of clarity, courts have sought to ground its elements in balanced policies. Judicial tests have asked if devices have noninfringing uses (Sony). If the party has knowledge and materially contributed to the activity (contributory infringement). If it has a financial interest and the right to control (vicarious liability). If it has an intent to induce infringement (Grokster).

Aiding-and-abetting liability lacks such nuance. It is borrowed from criminal law. And it is used to punish those who assisted in the crime. The getaway driver. The fraudulent check presenter. The cocaine distributor. In the criminal law arena, such liability reaches broadly to deter true criminal conduct.

In the context of secondary copyright liability, in contrast, such a standard is not appropriate. Not when copyright is subject to competing public policies. Not when technologies could be held criminally liable for allowing search, performance, or retrieval. Not when these monumentally significant issues--which would dramatically expand U.S. liability--were never even debated.

Yet another reason why ACTA is so troubling. And, of course, if there had been any serious public consultation on the document before it hit its "near final version," these are the sorts of gross mistakes the USTR could have avoided.

Filed Under: acta, aiding and abetting, copyright, secondary liability

Russian Internet Firms (And Google) Try To Explain Basic Liability Concepts To Entertainment Industry

from the third-parties dept

In the US, for the most part, we have legal safe harbors that enforce (usually) common sense points about liability into law. The basic idea is that a third party service provider or tool should not be held liable for what users do with those tools. Unfortunately, there are some problems with how this has been interpreted in the US at times, but at least the basics of reasonable safe harbors are there. And this is important. It makes no sense to blame a service provider for actions of users, but oftentimes those third parties are the primary targets of legal action, because they have more money and because it's an "easier" target. Over in Russia, apparently, there are no such legal safe harbors in place, and the biggest Russian internet companies, along with Google, all put out an open letter to the entertainment industry saying that it's time to stop blaming the internet companies for the actions of their users. It seems there have been some lawsuits in Russia against these sites, and they're not happy about it.

Part of the open letter appears to be an attempt to set up, without a legal basis, an agreement for a notice-and-takedown process of sorts. This is a bit disappointing of course. We've had such a notice-and-takedown process in the US for a while, and we've seen that it's quite frequently abused to takedown free speech and fair use content for reasons that have nothing to do with actual copyright issues. At the very least, it would have been better for these service providers to offer a notice-and-notice provision, where the users are notified that a copyright holder believes their use is infringing, letting them respond before the content is just taken down.

Filed Under: liability, russia, safe harbors, secondary liability
Companies: google

District Court Smacks Down Tiffany (Yet Again) In Fight With eBay Over Counterfeit Items

from the will-tiffany-ever-learn? dept

Back in April, we noted the latest in the rather long saga of Tiffany's legal fight against eBay. Tiffany had sued eBay, claiming that the online auction site was legally responsible for policing the site for counterfeit Tiffany items that users were selling. Despite the lack of a clear safe harbor (a la the DMCA or the CDA), the appeals court agreed with the district court that eBay was not liable for the actions of third parties on its site. The one area where the appeals court sent the issue back to the lower court concerned eBay's own advertisements. eBay had apparently run some ads that mentioned the availability of Tiffany products on the site, and Tiffany claimed this made them liable. The court noted that it didn't appear this was false advertising (as there was nothing false in the ads), but that it might confuse or mislead users. It asked the lower court to look into that specific claim.

It didn't take all that long, as the lower court once again sided with eBay and said that eBay did nothing wrong here:

"Tiffany failed to establish that eBay intentionally set out to deceive the public, much less that eBay's conduct was of an egregious nature sufficient to create a presumption that consumers were being deceived,"

You can also read the full opinion thanks to Eric Goldman: The case isn't quite over yet, as Tiffany keeps appealing various aspects of it, but it certainly doesn't look good for Tiffany -- but does appear very good for anyone who believes in the principles of properly applying liability to those who did the actions, rather than the "easy target" third party (even in the absence of official safe harbors).

Filed Under: advertising, secondary liability, trademark
Companies: ebay, tiffany

And, Of Course, ACTA Leaks: Some Good, Plenty Of Bad

from the this-is-not-a-good-idea dept

I imagine it will come as little surprise to anyone, but over the weekend, the latest draft of ACTA leaked. You can read it in wiki format over here. While it is "cleaned up" a lot from the last version, and appears close to being done, there are still some pretty big areas of disagreement. Specifically, the EU is still holding out for ACTA to cover patents as well as copyrights and trademarks, while the US doesn't want patents included for a variety of reasons. Also, as expected, the US has dropped explicit secondary liability language, but includes plenty of other vague language about anti-circumvention and "cooperative efforts within the business community," that you should be worried about. The "cooperative efforts" is code words for "ISPs should become entertainment industry cops." It's not direct secondary liability, but there's enough wiggle room there that it won't take long for the entertainment industry and its "friends" to start pointing out that ISPs that don't kick people off the internet, or don't hand over names of people, aren't making those "cooperative efforts." Just wait and see. In the meantime, considering the amount of research that has come out this year alone suggesting that neither counterfeiting nor copyright infringement are the big problems they're made out to be, why hasn't anyone asked the participating countries to explain why ACTA is needed in the face of this new evidence?

Filed Under: acta, anti-circumvention, copyright, eu, leak, secondary liability, us

Is The US Caving On ACTA? Or Is It Just A Trick?

from the could-it-be? dept

While we all wait patiently for the latest ACTA draft to leak (and, really, it makes no sense that it's not being released officially, since it will be leaked shortly anyway), there are reports spreading that the US has caved on some of the more controversial copyright sections it had supported, including both DMCA-like anti-circumvention and secondary liability for copyright infringement (i.e., a potential forcing of three strikes laws). Unfortunately, others are suggesting that this is not necessarily the case, as the US may have agreed to remove some language, but that the changes may not be as much of a capitulation as the earlier reports stated. That is, the US may have changed the language around to look like they were ditching secondary liability, but left in language that will still probably lead to the same thing:

So one real possibility here is that the U.S. agrees to strip out section 3's notice and take down requirement only to later interpret such a requirement to the be only logical way to meet what is left in section 1 and 3 quarter. All members will be expected to, and through the Special 301 process, sanctioned if they don't, adopt notice and take down -like requirements.

Filed Under: acta, secondary liability

Appeal Of Important iiNet vs. AFACT Case Begins

from the rehearing-the-same-thing dept

As you may recall, a bunch of movie studios sued popular ISP iiNet for failing to somehow wave a magic wand and stop file sharing. Thankfully, the Australian court quickly realized this was ridiculous and issued a thorough and convincing ruling that it made no sense to consider iiNet liable for copyright infringement done by its users. The judge pointed out that there's no evidence that iiNet "approved infringement." The judge also made it clear why it's nonsensical to think that ISPs should serve as copyright cops, since a determination on whether or not something is infringing takes place in a court, not by random ISP employees.

Not surprisingly, the movie studios and AFACT (the "anti-piracy" organization representing them) appealed the ruling, claiming that somehow the lack of stopping copyright infringement was effectively "authorizing" copyright infringement. That seems like a huge stretch, but the appeal has begun and AFACT is now trying to make the case that not blocking users or kicking them off is the equivalent of authorization. Hopefully the appeals court recognizes the wisdom of the lower court ruling.

Filed Under: australia, copyright, isps, secondary liability, studios
Companies: afact, iinet

Canadian Court Lets Perfect 10 Case Against Google Move Forward

from the oh-come-on dept

Over the years, we've written many, many, many times about Perfect 10, the former publisher of a porn magazine who has spent the last decade making ridiculously laughable arguments about how every search engine on the planet is infringing on its copyrights for pointing people to images that people had scanned from Perfect 10's magazines and put online. For the most part, these lawsuits have gone nowhere, but Perfect 10 is incredibly persistent. Last month, we wrote about a countersuit by Rapidshare, which detailed how Perfect 10 is now a "copyright troll," that (according to Rapidshare's claims) purposely tries to spread its works online in order to have more companies to sue. Obviously, a key target of Perfect 10 has been Google, though Perfect 10 keeps losing (and then continues to come up with ridiculous reasons to keep the lawsuit alive).

Apparently, Perfect 10 has decided that if the US courts won't work for this game, it might as well try elsewhere. An anonymous reader points us to the news that Perfect 10 is happily suing Google in Canada as well as the US. Google had, quite reasonably, sought to have the case dumped, noting the identical case going on in the US. However, the judge noted that, due to differences in copyright law between the US and Canada, the two lawsuits are not the same. Still, hopefully, a court will see through the ruse.

The press release from Perfect 10 also tries to distinguish its lawsuits from the recent Viacom ruling saying that Google is protected by the DMCA. And while there are differences in the case, Perfect 10's claims here are laughable:

"This case is inherently different from the Viacom v. Google case, where the Judge apparently felt that Google expeditiously processed Viacom's notices. Our experience with Google is that Google processes almost no notices from small companies," Zada adds. "I have sent more than 500 notices of infringement to Google," Zada said. "I basically do a Google Image search, cross off the images Perfect 10 does not own, and send an Adobe copy of that Google web page to Google, with the infringing images clearly marked. Google can clearly see which images are infringing and where they are located. Yet Google has refused to process those notices," Zada says.

That's both silly and misleading. We've seen Google pull down content on legitimately filed DMCA notices in a timely manner from companies big and small all the time. In fact, some of us feel that Google is often too quick to pull down content on DMCA notices. The problem, as was pointed out in the Rapidshare lawsuit, is that Perfect 10 refuses to follow the procedure put forth by the DMCA. There's a clear procedure for how to file a DMCA notice. But what's clear from the quote above is that Perfect 10 isn't filing a legitimate takedown. It's just sending screenshots with no additional information. And what's an "Adobe copy"?

Filed Under: canada, copyright, dmca, secondary liability
Companies: google, perfect 10

Now Available At Your Local Flea Market: Safe Harbors

from the do-your-own-policing dept

Online marketplaces like eBay have a bit of protection from liability if their platforms are used to sell counterfeit or copyrighted goods. However, in the offline world, flea markets have historically not been granted the same type of protection, as seen in Fonovisa v. Cherry Auctions (1996), where flea markets were found to be liable for selling infringing works.

But now, the same protections afforded to online marketplaces could now be coming to their offline counterparts. Texas judge Lynn Hughes has dismissed the case Sony Discos Inc. v. EJC Family Partnership, where Sony Music sued a flea market operator, Elwin J. Cole, for copyrighted goods being sold at the market. Sony alleged that EJC was guilty of contributory infringement by allowing its sellers to sell copyrighted goods in the market. The judge disagreed, ruling that it was not EJC's responsibility to police the market for Sony (full ruling here - pdf):

Sony does not argue and cannot show that Cole aided or enhanced infringing sales specifically, in a manner distinct from Cole's facilitation of all sales at the flea market.

...Cole is not akin to the driver of a get-away car; he is closer to the service station manager who sells the bank-robber gasoline.

So, perhaps driven by the safe harbors enjoyed by their online counterparts, offline flea markets are no longer to be held responsible for infringing uses of their marketplaces. If infringement happens, then it's reasonable for the owners to go after those specifically responsible -- it's inefficient and unfair to expect a marketplace to do the police work, especially when there are tons of non-infringing sales happening all of the time.

Filed Under: flea markets, liability, safe harbors, secondary liability

EU Proposes Criminalizing Inducing Infringement In ACTA Draft; Could Outlaw Google

from the third-party-criminality dept

While the EU Parliament has decisively denounced ACTA -- both in terms of the process and the substance of the (still secret) draft agreement, it appears that the EU negotiators are still pushing to include draconian provisions in ACTA. KEI has discovered that the EU is proposing to make inducement a criminal offense, rather than just a civil one:

KEI has learned that the European Union has proposed language in the ACTA negotiations to require criminal penalties for "inciting, aiding and abetting" certain offenses, including "at least in cases of willful trademark counterfeiting and copyright or related rights piracy on a commercial scale."

Of course, definitions matter here. In this case, the question is what constitutes "rights piracy on a commercial scale." Beyond the troubling notion that these negotiators are using such an inaccurate and imprecise word as "piracy" in such a big agreement, the commercial scale definition is quite broad:

"significant willful copyright or related rights infringements that have no direct or indirect motivation of financial gain"

Consider this the "let's criminalize The Pirate Bay" clause. Of course, it could also be read as the "let's criminalize the VCR clause" as well -- which is why this is so troubling. It's one thing to add civil penalties and liability to third parties through some sort of misguided secondary liability policy -- but it's really pushing to dangerous extremes to add criminal liability to that as well.

Now, let's look at the potential unintended consequences of such language. It effectively could outlaw Google. Google, without a doubt, can be used to "aid" or "abet" "copyright... piracy on a commercial scale... that have no direct or indirect motivation of financial gain. Now, those in support of this bill will quickly insist that no one is going to use it to shut down Google. And they're probably right, given Google's brand recognition. But the fear is that they would almost certainly use this to shut down the next Google-like company before it had a chance to get very big. This is what happens when you have technologically, economically clueless bureaucrats trying to protect a dying industry. You get bad regulations that have massively dangerous unintended consequences.

Filed Under: acta, copyright, criminal, eu, inducement, secondary liability, third party liability