The proposition that a party who links online to third-party materials cannot be a direct copyright infringer was bolstered by the 9th Circuit validating what is known as the “server test” four years ago in Perfect 10, Inc. v. Amazon.com, Inc. The server test focuses on the location of infringing material, but is the actual conduct of the alleged infringing party more important than the physical location of infringing material? This is the question that the 7th Circuit will answer in its review of the Northern District of Illinois’ decision in Flava Works, Inc. v. Gunter.
The server test addresses what it means to “display” a work for purposes of the Copyright Act. The test contrasts “a computer owner that stores an image as electronic information and serves that electronic information directly to the user (i.e., physically sending ones and zeroes over the [I]nternet to the user's browser,)” with a computer owner “that does not store and serve the electronic information to a user.” Perfect 10, 508 F.3d at 1159 (citations omitted). The first computer owner would be liable for direct infringement for displaying the electronic information in violation of a copyright holder's exclusive display right whereas the second computer owner would not be displaying that information, “even if such owner in-line links to or frames the electronic information.” Id.
The copyright infringement inquiry as applied to computer and internet technology is “highly fact-specific.” Flava Works. , 2011 WL 3876910 at *3. Prior cases have drawn distinctions between active and passive conduct by an entity when analyzing direct infringement for the actual posting/hosting of infringing material on the Internet. See Perfect 10, 508 F.3d at n.6. (discussing distinction between an entity that controls the online storage and communication of images from an entity that passively owns/manages an Internet bulletin board or similar system on which the users of the bulletin board or similar system post infringing works); CoStarGroup, Inc. v. LoopNet, Inc., 373 F.3d 544 (4th Cir. 2004)(an “ISP should not be found liable as a direct infringer when its facility is used by a subscriber to violate a copyright without intervening conduct of the ISP”). The Flava Works court seems to have brought this same line of thinking to its analysis of infringement liability for inline linking.
The Flava Works court rejected the server test and Perfect 10 “[t]o the extent that [it] can be read to stand for the proposition that inline linking can never cause a display of images or videos that would give rise to a claim of direct copyright infringement.” Flava Works, 2011 WL 3876910 at *4. The focus of the inquiry according to Flava Works should not be merely the location of the infringing works, but the conduct of the alleged direct infringers, who were users of the defendant website that was being sued for contributory infringement in that case. Id. at * 3. Although Flava Works and Perfect 10 arguably involved “essentially the same technology,” the Flava Works court dug deeper to determine whether the inline linking processes at issue were in fact different. Id. at *3, n.4 (distinguishing the technological processes at issue from those in Perfect 10).
The infringing videos that were displayed on the defendant website in Flava Works were stored on third-party servers, however, the court noted that the users handpicked and selected infringing videos to be linked/embedded on the defendant website. The users were causing a “display” to be made by bookmarking those videos, as one could go to a URL for the defendant website and press play to display a video. Id. at *4. In the view of the Flava Works court, “a website's servers need not actually store a copy of a work in order to ‘display’ it.” Id. Therefore, direct infringement liability can arise from inline linking to infringing material that is stored on a third-party’s system. Id.
Briefing on the Flava Works appeal in the 7th Circuit is still in progress, with amicus curiae briefs already having been filed by several entities, including Google Inc. and Facebook Inc.