Computer bulletin board operator liability for users' infringing acts.

• Date: 01 October 1995
• Author: Dobbins, M. David

INTRODUCTION

As computer technology has advanced and become less expensive, its role in modern society has become increasingly important. One effect of this development is the growth in popularity of computer bulletin boards.(1) A computer bulletin board does exactly what its name implies -- it allows users to post and read electronic messages by accessing a central computer via phone lines.(2) The content of an electronic message can be of the sort that would be found on a physical bulletin board,(3) such as a message concerning the time and location of a meeting, but may also consist of software,(4) digitized music,(5) Scanned pictures,(6) or other information capable of being stored and interpreted by a computer.(7) Users post messages on the bulletin board through a process called uploading and receive information from the bulletin board through a process called downloading.(8)

Computer bulletin boards vary widely in volume of usage and purpose. Almost everyone has heard of the large online services like America Online, Prodigy, and Compuserve, which provide access not only to bulletin boards but also to online shopping, electronic versions of newspapers and magazines, and electronic mail.

In addition, many smaller, locally run bulletin boards cater to more specialized interests.(9) Both large, ontime services and smaller, local bulletin boards have continued to grow in popularity. There are over four million users of the major online services, and individuals are setting up small, locally based bulletin boards every day.(10)

Another aspect of the growth in bulletin board technology is the Internet. The Internet is a collection of independently operated local and regional computer networks(11) connected through common procedures by which they address and route computer data.(12)

Through the Internet, users can gain access to vast quantities of information(13) and exchange various forms of data, for example, computer software.(14) Current estimates indicate that there are around twenty-five million users of the Internet in thirty-three countries who are served by over seven hundred and fifty thousand independent host operators.(15) Current estimates indicate that these numbers are increasing rapidly.(16)

Bulletin board technology, with its ability to disperse vast quantities of information quickly,(17) has created a communications revolution.(18) The increase in popularity of bulletin boards, however, has also multiplied the opportunities for abuse of the technology. Illegal distribution of copyrighted materials on computer bulletin boards has become a serious problem. High quality digitized pictures, digitized music, and software are all capable of being uploaded and downloaded from computer bulletin boards,(19) and users of bulletin boards have employed the technology to exchange a wide variety of copyrighted materials.(20)

Although it is clear that users who upload and download copyrighted materials without the permission of the copyright owners violate U.S. copyright law, it is unclear whether bulletin board operators are liable for the copyright infringement committed by users. Courts are just now beginning to grapple with this difficult issue,(21) and no clear consensus has developed on how to handle the problem.

Three distinct interests are involved in the resolution of this issue. First, copyright owners wish to preserve the integrity of their statutory monopoly against the challenges of new technology. Second, computer bulletin board operators have an interest in preserving the viability and growth of bulletin board technology and wish to avoid potentially prohibitive liability. Third, society at large seeks to accommodate the growth of useful new technologies and to encourage creative enterprises.

This Note argues that a computer bulletin board operator's liability for copyright infringement by users of the bulletin board should be analyzed under the theory of contributory copyright infringement. This Note calls for a standard of liability under contributory copyright infringement that accommodates the competing interests at stake in the resolution of this issue. Part I provides an overview of copyright infringement law and argues that in most situations the operator's actions, viewed independently, do not constitute copyright infringement. Part Il explores theories of third-party liability. This Part rejects the doctrine of vicarious liability as an effective means for establishing bulletin board operator liability and argues that contributory copyright infringement theory provides a more solid foundation for finding operator liability. Part III then proposes that courts employ a negligence standard to analyze contributory copyright infringement claims against bulletin board operators.

1. OVERVIEW OF COPYRIGHT INFRINGEMENT AND APPLICATION OF DIRECT INFRINGEMENT ANALYSIS

   In order to determine whether a computer bulletin board operator is liable for the uploading and downloading of copyrighted material on her bulletin board, a court must first determine whether the operator's actions have directly infringed on the rights of a copyright owner or whether a theory of third-party liability must be applied. This inquiry, unfortunately, is not always an easy task as the line dividing direct and indirect infringement has become somewhat fuzzy.(22) The choice between direct and indirect infringement is important, however, because it determines the standard of liability. For example, under a theory of direct infringement, a plaintiff need not prove that the defendant had knowledge that his activity constituted infringement,(23) while under some theories of third-party liability, knowledge of the infringement is a required element.(24)

   Section I.A provides an overview of copyright infringement law and situations in which direct and third-party theories of liability are applicable. Section I.B argues that a bulletin board operator who does not herself engage in uploading or downloading of copyrighted material is not directly infringing a copyright, and thus courts must apply a theory of third-party liability in order to find a bulletin operator liable in this situation.

   1. Copyright Infringement Law

      Section 106 of the Copyright Act of 197625 gives copyright owners five distinct rights: 1) copying of the copyrighted work; 2) preparing derivative works; 3) distributing copies of the work; 4) performing the work publicly; and 5) displaying the work publicly.(26) Section 501 of the Copyright Act prohibits a person who is not the copyright owner from engaging in any of the enumerated activities under threat of civil liability as a direct infringer.(27)

      An individual who engages in one of the prohibited activities is a direct infringer and may be liable to the copyright owner for either direct damages and profits arising out of the infringing use(28) or, alternatively, damages specified by the statute.(29) For example, if a person puts on a musical which includes performances of copyrighted songs, that person will be liable to the copyright owner for the profits from the performance that are attributable to the infringement and for the loss in market value of the copyrighted work due to the infringement.(30)

      If a court finds that an individual did not herself engage in one of the activities enumerated in section 106, she may still be liable for copyright infringement under a theory of third-party liability.(31) Theories of third-party liability make people who are not themselves engaging in infringing activities liable for copyright infringement based on their connection to another person's violation.(32) For example, if the owner of a night club hires a band as an independent contractor to perform live music and the band performs a copyrighted piece of music without the copyright owner's permission, the band violates the performance right of the copyright owner and hence is a direct infringer.(33) However, the owner of the bar who hired the band has not acted in violation of the copyright owner's section 106 rights because hiring a band is not within the activities prohibited by the statute. Therefore, the owner's liability will not rest on a direct violation of the statute but rather on his relation to the infringing party and the act of infringement.(34) In contrast, if the owners of a bar or their agents play a piece of recorded music in the bar without the permission of the copyright owner, they are correctly labeled as "direct" infringers because they have directly violated the owner's section 106 "performance" right.(35)

   2. Direct Infringement Law Applied to Bulletin Board Operators

      It is often difficult to determine whether to characterize a person's actions as directly violative of the copyright owner's rights or only as potential third-party infringement. The decisions of the two courts that have addressed the issue of computer bulletin board operator liability reflect this difficulty. In Playboy Enterprises v. Frena,(36) the court had to determine an operator's liability for the acts of users who had uploaded and downloaded the plaintiff's copyrighted photographs. Despite the defendant's defense of lack of knowledge of the infringing activity,(37) the court found the operator liable as a direct infringer on the ground that providing access to the computer bulletin board was equivalent to "distributing" and "displaying" the infringing photos.(38)

      By contrast, the other court that has analyzed a computer bulletin board operator's liability for infringing acts of users, Sega Enterprises v. Maphia,(39) used a theory of third-party liability. In that case, a bulletin board operator had allowed users to upload and download Sega's copyrighted video games. The court noted that, in the instances where the defendants did not themselves upload or download copyrighted games, liability could still be found under the third-party liability theory of contributory copyright infringement, stating, "[e]ven if...