Discussion on a Few Practical Issues in Judicial Protection of Internet Copyright (Part II)

By the Task Group of Internet Copyright, IP Tribunal, the High People’s Court of Guangdong Province,[Copyright]

V. Advertisement Income and Gains Directly from Infringing Works
Article 22 of the Ordinance for the Protection of Information Network Dissemination Right provides that as one of the conditions for exemption, an ISP shall never receive any economic benefits directly from the works, performances or audio/visual products that users provide. In judicial practice, major differences exist on the understanding of “[direct] economic benefits”, which are centered on whether the advertisement income of an ISP is a direct economic benefit from works that users provide.
Some scholars argue that as long as no users are directly charged, any income of an ISP from its advertisements is not such a direct economic benefit. For example, in Beijing Ciwen Pictures Co., Ltd. v. Beijing Me Happy Co., Ltd. for infringement of network dissemination right, the court ruled that although Me Happy, which offered videos on its website for free viewing by its users, published an advertisement before the infringing video, there was no evidence that the company benefitted directly from that video. Therefore, Me Happy was not ordered to pay damages for infringement. However, some scholars argue that the advertisement income of a website is hooked with the click-through rate (CTR), and more clicks or downloads mean more advertisement income for the ISP. In the above case, the infringing work directly benefitted the ISP, and the ISP should be subject to infringement liability; otherwise, the copyright holder’s rights and interests would be seriously harmed.
We argue that in respect of the relationship between an advertisement income and direct economic benefits from infringing works, the views in the preceding paragraph are off the point and deserve further discussion. First, “direct economic benefits” here not only refer to charges that an ISP may directly make to the general public for infringing works it provides, but also to benefits from illegally transmitting or contributing to transmission of infringing works. When a contributory transmitter benefits from its contribution to the transmission of infringing works that users provide, other than from providing storage spaces, P2P software or platform, or any information location tool, it receives a direct economic benefit from such infringing works. Second, different types of advertisements should be differentiated before a correct conclusion can be reached on the causation between the infringing act and the advertisement income of an ISP. A further study is needed to determine an advertisement income as or as not a direct benefit from infringing works.
1.       Advertisements in the header, footer or middle of, or floating over a webpage.
This advertisement income is usually from the advertising service of the ISP, other than from infringing works. For example, tudou.com, by launching advertisements on the header and footer of its home page, receives an income on the basis of the CTR of the home page, and this CTR is from its users to which it provides information storage space service. Therefore, this advertisement income is not a benefit directly from infringing works.
2.       The advertisement in a given section of an ISP.
For example, in the Music Box, the screen with cached lyrics often contains an advertisement, and a user who gets any cached lyrics must view the advertisement. The income from such advertisement is an income from cached works, and the advertising campaign will not be successful unless and until a large number of users obtain cached lyrics. This income is proportional to the number of online transmissions and downloads of the Music Box. Therefore, the cached lyrics provider benefits directly from its cached lyrics.
3.       Covert advertisements, such as those embedded into Xunlei or Baofeng players.
They are directly embedded into an online player, and always pop up even when the player is buffering or pauses playing. The income from such advertisements is not an income that the ISP receives for its storage space, P2P software, or service platform. It comes directly from the works that the ISP provides. In other words, this income is necessarily and directly connected with the works that the ISP transmits.
To sum up, an ISP be determined as benefiting directly from such infringing works, only if a direct and necessary causation is established between an advertisement income and an infringing work. If the relationship is indirect or probable, generally it would be inappropriate to determine the ISP as infringer.
VI. Notice by Rights Holders and the Fault of an ISP
Article 14 of the Ordinance for the Protection of Information Network Dissemination Right provides that a rights holder may notify an ISP, demanding it to delete infringing works. Because it is concerned with a safe harbor, it is essential to understand what information such a notice should include, what constitute a legal notice, and the relationship between this notice and the fault of an ISP. For example, in the Yahoo! China case for infringement of neighboring right, the rights holder believed that Yahoo! China, as operated by Alibaba, provided music search results that contained infringing information, and gave a legal letter to it, demanding the website to delete the infringing links. Yahoo! China argued that it was not faulty even if it did not do its best to delete the infringing links, on the ground that the notice, that is, the legal letter of the rights holder, was not a legal one, because it only provided the names of singers and songs, but contained no related URLs.
We argue that a notice made under Article 14 of the Ordinance must include all required elements listed in that clause, which are the essential or the lowest required elements of such a notice. A non-complying notice given should be deemed as no such notice given. The reason why a complying notice is required is that an ISP which deletes works according to a non-complying notice will possibly be sued by the uploader of such works, and as a result, will possibly face the claims from both the uploader and the notice giver.
In respect of whether URLs are a required element of such notice, we argue that the “Internet address” in Article 14 should work to locate relevant information, but not necessarily be an URL. For instance, when a rights holder specifies all the names of infringing songs and their singers and albums, and stated that all the links of a website are infringing, the linking service provider will certainly be able to locate infringing links among search results, and technically delete or block them. As Internet resources are numerous and always changing, it is very difficult or impractical, if not impossible, for a rights holder to list each and every infringing URL.
Therefore, from the legislative intention of the Ordinance, as long as a rights holder provides detailed information of the songs it claims, and as long as such information is sufficient for the linking service provider to locate infringing information, the linking service provider should delink with all infringing songs. In respect of the “preliminary materials certifying the infringement” in Article 14, we argue that this requirement is not met, if the notice only states that it is given by a rights holder or only contains a charge of infringement. The notice giver shall supply additional preliminary proof of his being a rights holder, such as signed published evidence, or the legal source of its right.
VII. Falsification of Webpage Notarization
Information on the Internet is changeable and difficult to fix, and for this reason, mostly the plaintiff obtains evidence through notarization. However, we have found a few issues regarding the notarization of infringing facts. For instance, a notarization only contains oversimplified operations other than the URLs, webpages opened and the time of access. It cannot be employed to determine whether the infringing work comes from a local computer or from the World Wide Web, or whether the website address concerned may point to someone else other than the defendant. Also, the authenticity of a notarization by the defendant on the ground that the notarization was not done before all the computers, pocket hard discs or other storage devices concerned had been checked of their cleanness. Since the Internet technology is complicated and technical means are varied, rights holders and notaries both need to improve their notarization-related technology and skills.
Currently, special attention should be paid to the challenge on the authenticity of a notarization. Such a challenge has the following features: (1) the infringing fact is notarized at the place of the plaintiff by notarial officers, who use computers of the notary public, and access the Internet through a network port at the place of the plaintiff; (2) The defendant, also through notarization, proves the possibility of falsifying a webpage, that is, a hacker program could be run to interfere with an online computer, so that from the address typed in the address bar of a browser, the online computer would enter a falsified other than the true webpage; and (3) The defendant argues that the webpage that the notary opened at the place of the plaintiff was falsified by the plaintiff, and as the notarized fact cannot be reversed, the defendant can only prove the possibility of falsifying the webpage, but cannot produce evidence directly contrary to the notarization of the plaintiff. In this case, a court judge has to decide whether the notarized evidence of the plaintiff can be admitted as a basis to determine an infringing fact.
In computer technology, with the running of a relatively simple hacker program, a remote computer on a LAN can deceive a notarial computer and cause it to enter a falsified webpage. Therefore, even if a notary brings with him a notarial computer and keep it clean, he cannot ensure the security of the networking environment at the plaintiff's place. Generally, if the place to access the Internet were at the place of the notarial public, or the place of a third party which has not interests in the litigation, or the place of the defendant, webpage falsification or hacker attack would be less probable. Even if there were a falsified webpage or hacker attack, it would be much more difficult to run it at a place other than that of the plaintiff.
Therefore, we argue that since notarization should be fair and objective, considering the likelihood of Internet evidence to be technically interfered with, a notarized fact should not be admitted as evidence, if the following circumstances exist: the notarization is done at the place of the plaintiff; the defendant reasonably questions the cleanness of the notarial computer or the security of the network of the plaintiff; and the notarization contains such defects as the time of notarization at the early morning or a later time or multiple online operations done simultaneously. With these guidelines, the complainant and notarial officers will obtain evidence in a more normative way.
VIII. Infringement by Shortcuts of an Internet Cafe
Certain copyright infringement disputes involve Internet cafes, where users can quickly enter a webpage containing infringing works by clicking on a shortcut on the desktop. Do such shortcuts constitute a link to infringing works? Does an Internet cafe with such shortcuts engage in copyright infringement? If both answers are yes, is it a direct or contributory infringement of network dissemination right?
A “shortcut” is a quick start application of the Windows Operating System, which points to a file or folder. For convenience, it is usually placed on the desktop, start menu or task bar. Generally, it is a command line to quickly start an application. It is a very convenient tool, when used together with installed programs or stored files. If a shortcut is deleted, the target program or file can still be found and run through my Computer. However, when the target program or file is deleted, the shortcut will become useless. Therefore, a shortcut will not work if copied from one computer to another. In this sense, a shortcut is a location limited technology.
An Internet cafe may create shortcuts to: (1) works stored on the server of the Internet cafe; (2) works on a third-party website; or (3) URLs of a third-party website. Under the first circumstance, the existence or not of such shortcuts cannot change the fact that the works with which the shortcut links are on the server of the Internet cafe. Therefore, the Internet cafe may be determined as infringing copyright by providing infringing works on its server, other than by creating shortcuts to such infringing works. In the third circumstance, the shortcuts point to the address of a website, as if a road sign were created at the terminal computer to point to the third-party website. When clicking on the shortcut, a user will enter the third-party website. The address displayed on the address bar of the browser is the address of the third-party website. If the third-party website contains both infringing and non-infringing works, the shortcut that points to the website link indirectly with infringing works.
The act of the Internet cafe to create such shortcuts is not causally related with the consequence of infringement, and does not constitute copyright infringement. As to the remaining second circumstance, a shortcut is created to point to a specific work stored on the server of a third-party website, so that by clicking on the shortcut, a user will directly view such works. Essentially, in creating such a shortcut, the Internet cafe has created a link to the work. As the linking service provider, the Internet cafe may be held liable for infringement if the work that the shortcut links to is infringing. Therefore, whether the provision of shortcuts constitutes infringement should be determined on a case-by-case basis. Any determination of infringement or noninfringement without differentiating the circumstances may lead to an erroneous conclusion.
(Translated by Ren Qingtao)
(The task group members are Zhang Xuejun, deputy head of No. 3 Civil Tribunal; Yue Lihao, Zheng Ying, Zhang Zewu, and Yu Jie, judges of No. 3 Civil Tribunal, the High People’s Court of Guangdong Province)

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