Contributory & Vicarious Infringement

A copyright owner may bring an infringement claim against (a) the person actually engaged in the unauthorized use of the work, and also against (b) “contributory” and (c) “vicarious” infringers.

The Copyright Act does not specifically discuss “secondary” liability, but courts  recognize the doctrines of contributory and vicarious liability. Seee.g., Polygram Int’l Publ’g, Inc. v. Nevada/TIG, Inc., 855 F. Supp. 1314 (D. Mass. 1994); Demetriades v. Kaufmann, 690 F. Supp. 289 (SDNY 1988).

Plaintiff’s increasingly invoke both types of secondary liability, especially when suing multiple of direct infringers (as with Internet copying and distribution).

Contributory Liability

The Supreme Court endorsed contributory copyright liability in Sony v. Universal.  Sony Corp. of America v. Universal City Studios, Inc. 464 U.S. 417 (1984).  In Sony the plaintiff, a film studio, argued that the manufacturer/distributor of the BetaMax video cassette recorder was responsible for contributory infringement, based on the direct infringement allegedly committed by the home-taper. The Supreme Court determined that contributory liability is encompassed within § 106 of the Copyright Act, even though its not mentioned explicitly. Section 106 gives the copyright owner the exclusive right not only to make copies but “to authorize” others to make copies.

Contributory liability is like tort liability. Tort cases generally treat a person who knowingly participates in a tortious act as jointly liable with the primary tortfeasor. The Sony Court endorsed an earlier Second Circuit definition of contributory infringement: “[O]ne who, with knowledge of the infringing activity, induces, causes, or materially contributes to the infringing conduct of another, may be held liable as a ‘contributory’ infringer.”  Gershwin Publ’g Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159, 1162 (2d Cir. 1971).

The Supreme Court in Sony cautioned, however, that the manufacturers and sellers of videotape machines could not be liable merely because they had constructive knowledge that their purchasers might use the equipment to make infringing copies. Borrowing from the socalled “staple article” exception in patent law, 35 U.S.C. § 271(c), the Court held that selling the videotape recorders would not constitute contributory infringement “if the product is widely used for legitimate, unobjectionable purposes. Indeed it need merely be capable of substantial noninfringing uses.” Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 442 (1984).

Because many copyright owners of television programs do not object to home videotaping, and because even unauthorized home videotaping, for time-shifting purposes, is a fair use, the Court concluded that “the Betamax is, therefore, capable of substantial noninfringing uses. Sony’s sale of such equipment to the general public does not constitute contributory infringement of respondents’ copyrights.”  Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 456 (1984).

Vicarious Liability

Vicarious liability is akin to respondeat superior. That is, an employer might be liable for the infringing acts of her employees.  Unlike contributory liability, vicarious liability can be imposed on persons who do not “induce, cause or materially contribute to” direct infringement or indeed who do not even know that another is involved in infringing activity.

Vicarious copyright liability can be imposed on the basis of principles akin to those underpinning so-called “enterprise liability.” In a seminal case on the issue, Shapiro, Bernstein & Co. v. H.L. Green Co., the Second Circuit held:

When the right and ability to supervise coalesce with an obvious and direct financial interest in the exploitation of copyrighted materials—even in the absence of actual knowledge that the copyright monopoly is being impaired—the purposes of copyright law may be best effectuated by the imposition of liability upon the beneficiary of that exploitation. Shapiro, Bernstein & Co. v. H.L. Green Co., 316 F.2d 304, 307 (2d Cir. 1963).

In that case, the court imposed liability for the sales of infringing phonograph records upon the owner of a department store, as well as upon the record concessionaire actually doing the selling within the store.  The store owner had the right to supervise the concessionaire and to share in its gross receipts from record sales.

Find the Deep Pockets. In an effort to apply or extend the principle of vicarious liability (often with a view toward finding more solvent defendants), plaintiffs have named as defendants such entities as radio stations on which allegedly pirated merchandise is advertised, as well as sponsors of allegedly infringing broadcasts. See Screen Gems-Columbia Music, Inc. v. Mark-Fi Records, Inc., 256 F. Supp. 399 (S.D.N.Y. 1966) (advertising agency); Davis v. E.I. DuPont de Nemours & Co., 240 F. Supp. 612 (S.D.N.Y. 1965) (sponsor of television show and its advertising agency).

Swap Meets

These two theories of secondary liability were brought to bear in Fonovisa v. Cherry Auction, an influential 9th circuit decision. Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259 (9th Cir. 1996). See also Arista Re cords, Inc. v. Flea World, Inc., 2006 WL 842883 (D.N.J. 2006).  The plaintiff held copyrights in Hispanic music recordings, and claimed infringement on the part of the operators of a flea market (or “swap meet”) where third-party vendors routinely sold counterfeit recordings. The vendors rented space for their booths, and Cherry Auction advertised, supplied parking and refreshments (from which it derived income, to add to its admissions fees), and retained the right to exclude any vendor for any reason. The trial court had dismissed the complaint, but the court of appeals viewed the allegations as sufficient to sustain secondary-infringement claims. After a thorough review of the precedents, the court of appeals held that Cherry Auction would be vicariously liable for the vendors’ directly infringing record sales, because through its right to terminate vendors it had the ability to control their activities, and because it reaped “substantial financial benefits from admission fees, concession stand sales and parking fees, all of which flow directly from customers who want to buy the counterfeit recordings at bargain basement prices.” Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 263 (9th Cir. 1996). The court also found sufficient allegations of contributory infringement because Cherry Auction allegedly knew of the directly infringing sales and because it provided the “site and facilities” (i.e., space, utilities, parking, advertising, plumbing and customers) for those infringements.


It was only a matter of time before these principles and precedents were applied so as to determine whether there was secondary infringement on the part of website operators—such as Napster, StreamCast, and Grokster—that provide file-sharing software that can be used to facilitate the unauthorized exchange of music on the Internet. The first important decision was the 9th Circuit’s Napster case.  A & M Records, Inc. v. Napster, Inc. 239 F.3d 1004 (9th Cir. 2001).

There the court concluded that individual Napster users were infringing (by duplicating and distributing copyright-protected music and recordings) and were not engaging in fair use, and that Napster, Inc. was secondarily liable. There was contributory infringement: “Napster has actual knowledge that specific infringing material is available using its system, that it could block access to the system by suppliers of the infringing material, and that it failed to remove the material,” and Napster provided the “site and facilities” to assist finding and downloading the recordings.  A & M Records, Inc. v. Napster, Inc. 239 F.3d 1004, 1022 (9th Cir. 2001). As for vicarious infringement, Napster had the ability to locate infringing material on its search indices and the right to terminate users’ access to the system; it also derived ever-increasing advertising revenues as more users were drawn to its website through the appeal of the infringing music.  In a later case in which the defendant’s file-sharing technology was somewhat different, the Seventh Circuit reached essentially the same conclusion concerning contributory liability as did the Napster court, and reserved judgment on the question of vicarious liability. In re Aimster Copyright Litig., 334 F.3d 643 (7th Cir. 2003).

The same court, the Ninth Circuit, reached a different conclusion—neither contributory nor vicarious infringement—in a later case involving the Grokster software, which created a more decentralized file-sharing network than in Napster, allowing the defendants to “step aside,” as it were, and to let the music-file swappers do so directly, without going through a centralized server and indexer. When the case reached the Supreme Court, the respondent companies invoked the Sony decision and sought to prove that their software was capable of substantial noninfringing uses, for example, the swapping of uncopyrighted material.


But in MGM v. Grokster, the Supreme Court reversed. Metro-Goldwyn-Mayer Studios Inc. v. Grokster Ltd., 125 S. Ct. 2764 (2005). While declining to determine how the Sony “substantial noninfringing use” test would apply to Grokster, six Justices who joined in the unanimous Court opinion did opine as to how the Sony test would apply on the record before them, with three finding contributory liability and three finding none. Metro-Goldwyn-Mayer Studios Inc. v. Grokster Ltd., 125 S. Ct. 2764 (2005).

Rather, the Court—buttressed by the Patent Act provision imposing liability upon “[w]hoever actively induces infringement”  35 U.S.C. § 271(b) — held instead that “one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties.” Grokster, 125 S. Ct. at 2770.  Although one could not infer from Sony’s sale of its Betamax videotape recorder, without more, that it knew of substantial infringement by users, there was no doubt of that with Grokster, whose business plan and advertising were explicitly designed to encourage unlawful private copying, particularly by those who had been forced to leave Napster as a result of the adverse judgment against it in the Ninth Circuit. The Court rejected the defendants’ contention that a finding of secondary liability would significantly interfere with the development of new electronic technologies: “The inducement rule . . . premises liability on purposeful, culpable expression and conduct, and thus does nothing to compromise legitimate commerce or discourage innovation having a lawful promise.” Grokster, 125 S. Ct. at 2780.

Issues of secondary copyright infringement are also raised when the defendant is one step more removed from the direct infringement than in the cases just discussed—in which the defendants consciously designed and distributed software that was used, and was largely meant to be used, to make illicit copies and phonorecords. What, if any, liability is there, on the part of Internet service providers (ISPs)—such as AOL and, increasingly, telephone and cable companies—that allow home computer users to connect to the Internet and to post and exchange all manner of potentially copyright-protected materials? These ISPs provide an appealing target for copyright infringement lawsuits, when the alternative would often be cumbersome suits against individuals.

The solution to this question has been provided partly by the federal courts and partly by Congress. Perhaps the most influential court decision is Religious Technology v. NetcomReligious Technology Center v. Netcom On-Line Communication Services, Inc., 907 F. Supp. 1361 (N.D. Cal. 1995). The plaintiff, a unit within the Church of Scientology, finding that a disgruntled former member, Erlich, had posted certain unpublished Church documents on an online “bulletin board,” brought a copyright infringement action against the operator of the bulletin board and the ISP that provided online access to the bulletin board and to the Internet more generally. The court held that the ISP (Netcom) could be liable as a contributory infringer if, after receiving a “take-down notice” from the Church, it could reasonably have known of the copyright-protected status of the posted documents, and it allowed the messages to remain on its system and to be further distributed to servers worldwide. The court also found, with respect to vicarious liability, that Netcom had a history of policing its users’ postings and suspending some (for obscenity, commercial advertising and the like); but that it derived no economic benefits from Erlich’s infringement.

Internet Service Provider Safe Harbor

Although the Netcom case and others like it exonerated ISPs from direct liability when they acted as “mere conduits” for Internet communications, the prospect of even indirect liability for contributory infringement spurred service providers to lobby Congress for exemptions from copyright liability and remedies. In 1998 Congress passed the Digital Millennium Copyright Act (DMCA), which added § 512 to the Copyright Act. 17 U.S.C. § 512.  That section adjusted the risks of copyright owners and service providers so as to place the burden on the former to identify and notify “mere conduit” service providers of infringements carried by or residing on the providers’ systems. By contrast, the law makes no special provision for service providers who originate or are otherwise actively implicated in the content residing on their servers or transiting through their systems.

Section 512 of the Copyright Act does not purport to define the conduct of an ISP that would render it liable for direct, contributory or vicarious infringement; rather, it identifies several different ISP activities and specifies conditions for immunizing the ISP against monetary relief and for limiting its exposure to injunctive relief. Section 512 distinguishes, for example, the “mere conduit” from the ISP that stores allegedly infringing material for more than several days (e.g., by providing server space for a user’s website). The former is given immunity from monetary liability in most instances, while the latter is susceptible to “take-down notices” from copyright owners and an obligation under stipulated circumstances to remove the allegedly offending material from its network. Section 512 is intricate and requires patient reading. See generally, Rossi v. Motion Picture Ass’n of Am., 391 F.3d 1000 (9th Cir. 2004); ALS Scan, Inc. v. RemarQ Cmtys., Inc., 239 F.3d 619 (4th Cir. 2001).