"WEB POSSE" LOSES SHOWDOWN IN FEDERAL COURT

     In late March of this year, the United States District Court for the Northern District of California ruled against copyright liability of a Usenet news service for robotically posting adult images that were allegedly protected under U.S. copyright law. The author of this article represented Defendant "GiffyNews" in the action. The lawsuit was filed by a member of the renegade Internet vigilante group known as the "Web Posse" who claimed GiffyNews illegally provided access to the images on the News Groups.

     The "Usenet" is a vast unregulated database of information which is anonymously posted on the Internet by the public at large, organized into individual "News Groups." Defendant GiffyNews provided its customers with a daily reporting service of new adult images posted on the Usenet, indexed accordingly to News Group address and date of posting. GiffyNews collected and catalogued the new postings automatically without reviewing or altering the content.

     The "Web Posse" is a self-styled vigilante group employing tactics of fear to shut down the Usenet news services by threats of legal action. It is composed of a handful of adult image publishers who are desperate to control the proliferation of their copyright images on the Web. (See article in April 1998 edition of WWWiz Magazine, "Vigilantism on the Web: The 'Web Posse' Crosses the Line.") For example, members of the Web Posse in this case launched the following e-mail messages to defendant GiffyNews as well as GiffyNews' up-stream Internet Service Provider who, out of fear, shut down GiffyNews' business:

     You have no choice but to admit that you are breaking the law, and take our warning as a gift. I have the right to protect my property, as does every other producer of adult images that you are stealing from. We are aware of all the other sites, but right now we have you, and you are the issue. Unless you have unlimited resources, you are about to crumble under the largest law firms in this industry. This is the last E-mail you will receive from me. Here after [sic], I will advise all of our members to retrieve their images by using programs that will utilize your bandwidth. Then we will still go to court with people you never dreamed you'd ever meet. Sincerely, "Soothsayer of Doom." http://www.apic-webposse.com.

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     APIC is a coalition of content producers and owners who are violated by operations like yours. You're not Usenet. You are taking from Usenet and reselling material that you have no rights to. You are in violation of Federal laws as well, Title 18, USC 2257. Ask your attorney about that, because today, our attorney is sending a letter to the US Attorney in SC regarding your company. Then the FBI will be at your door, and then your attorney will be happy, because you will have to give him all of your money.

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     Steve - Cyber Entertainment Network will PAY ALL EXTRA ATTORNEY FEES if you can move quickly on this idiot!!! They must be real stupid to think you can publish somebody else's work, collect money, and think they have no cost of goods!! What s---!! Call the attorneys and serve this asshole(s), garnish their MERCHANT ACCOUNT and/or BANK or can I just fry their servers for the hell of it!!!

     GiffyNews responded by offering to filter out any images that the Web Posse claimed were infringing, upon receipt of information identifying those images. The Web Posse, however, refused to turn over the requested information and thereby prevented GiffyNews from accommodating their concerns. Instead, the Web Posse preferred a showdown in court over a pre-litigation settlement in a bid to run up unnecessary legal expenses. But the tactics of this gang of wayward "cowboys" translated badly into a clumsy and unsophisticated pleading. Even without a legal analysis, it is offensive to our common sensibilities to freedom of speech to think that a news service would be "arrested" by the FBI for providing what is basically an information location tool not unlike the services of an Internet search engine. The court's rationale was simple.

     The Federal District Court predictably applied the rule of law in the case of Religious Technology Center v. Netcom On-line Communications (See article in November 1997 issue of WWWiz Magazine, "ISP Liability: What You May Know May Hurt You.") The court applied the three-prong analysis of on-line copyright liability consisting of: (1) Direct infringement; (2) vicarious infringement; and (3) contributory infringement. GiffyNews and other news services that simply report what is already posted on the Usenet could never be held liable for direct infringement because they do not post any materials on the Usenet in the first place. Rather, they simply provide access to potentially infringing materials that are already posted there. The court cited Religious Technology Center by stating:

     However, plaintiffs' theory further implicates a Usenet server that carries Erlich's message to other servers regardless of whether that server acts without any human intervention beyond the setting up of the system. It would also result in liability for every single Usenet server in the worldwide link of computers transmitting Erlich's message to every other computer. These parties, who are liable under plaintiffs' theory, do no more than operate or implement a system that is essential if Usenet messages are to be widely distributed. There is no need to construe the Copyright Act to make all of these parties infringers.

     The court also dismissed any notion that a Usenet news service could be liable for vicarious infringement. The elements of vicarious liability for copyright infringement require that the defendant have the right and ability to control the infringer's acts, and receive a direct financial benefit from the infringement. Obviously, GiffyNews did not have the right and ability to control either its subscribers or the persons who originally placed the alleged infringing images on the Usenet in the first place. Furthermore, because GiffyNews received no enhanced fee, but simply a flat monthly rate for its services, GiffyNews could not be said to have received a "direct financial benefit" from the allegedly infringing images as opposed to any other non-infringing content. The court stated:

     Copeland however failed to raise an issue of material fact whether GiffyNews received a direct benefit from the infringing activity of its users. Copeland alleges that the monthly service fee from subscribers is a direct financial benefit. However, in Religious Technology Center, the court held that a monthly fee is not evidence of a direct financial benefit. Like Religious Technology Center, there is no evidence that infringement by any user in any way enhances the value of defendants' services to subscribers or attracts new subscribers.

     Finally, and most obviously, the Federal Court dismissed the possibility of liability under the third prong known as contributory infringement. Contributory infringement is established when a defendant causes or materially contributes to the infringing conduct of another with knowledge of the infringing activity. Because the Web Posse refused to provide GiffyNews with information about which images it claimed to be protected, GiffyNews could not respond in any way to filter out those particular images. The Web Posse, in effect, affirmatively denied GiffyNews any knowledge of the infringing activity of which it was accused. Accordingly, this is a case where it could be said the Web Posse "shot itself in the foot." Had the Web Posse chosen to provide the information as requested, rather than corner GiffyNews into a lawsuit, it may have prevailed.

     The Web Posse's courtroom defeat is encouraging to legitimate Usenet news services and Internet Service Providers. While the Internet provides challenges to copyright issues, the defeat of the Web Posse in this case demonstrates that our legal system will not support irrational home-spun legal theories and bullying tactics as a means of resolving business disputes. With this decision, we can only hope that the Web Posse will take the hint and ride quietly into the sunset.

     Shelley M. Liberto is an attorney whose practice focuses on software and Internet-related issues. His Web site is located at http://www.libertolaw.com.