Religious Technology Center v. Netcom
Encyclopedia
Religious Technology Center
v. Netcom On-Line Communication Services, Inc.
, 907 F. Supp. 1361
(N.D. Cal. 1995), is a U.S. district court
case about whether the operator of a computer bulletin board service ("BBS
") and Internet access provider that allows that BBS to reach the Internet should be liable for copyright infringement committed by a subscriber of the BBS. The plaintiff Religious Technology Center ("RTC") argued that defendant Netcom was directly, contributorily, and vicariously
liable for copyright infringement
. Netcom moved for summary judgment
(i.e., Netcom urged the court to make a judgment without a full trial
), disputing RTC's claims and raising a First Amendment
argument and a fair use
defense. The district court of the Northern District of California
concluded that RTC's claims of direct and vicarious infringement failed, but genuine issues of fact precluded summary judgment on contributory liability and fair use. (I.e., facts about contributory liability and fair use that required adjudication by trial
precluded the court from making a decision without a trial.)
. Defendant Dennis Erlich was a vocal critic of the Church via the Usenet
newsgroup
alt.religion.scientology ("a.r.s."). Erlich posted portions of copyrighted works of RTC on a.r.s.
Erlich gained his access to the Internet through defendant Tom Klemesrud's bulletin board service ("BBS"), which had approximately 500 paying users. Klemesrud's BBS was linked to the Internet through the facilities of defendant Netcom. When Erlich posted messages to Usenet, he transmitted his messages to Klemesrud's computer using a telephone and a modem, and the messages were briefly stored on Klemesrud's computer. Then the messages were automatically copied from Klemesrud's computer to Netcom's computers and other computers on the Usenet according to a prearranged pattern. Once the messages were on Netcom's computers, they were available to Netcom's customers to download. The messages were stored on Netcom's system for eleven days and Klemesrud's system for three days.
RTC failed to persuade Erlich to stop his postings, and contacted Klemesrud and Netcom. Klemesrud asked RTC to prove that it owned the copyright to the works posted by Erlich, but RTC refused. Netcom similarly refused RTC's request that Erlich not be allowed to access the Internet through its system.
established that the loading of data from a storage device into RAM
constituted copying, because that data stayed in RAM long enough for it to be perceived. Erlich's act of sending a message to a.r.s. caused reproductions of portions of plaintiffs' work on both Klemesrud's and Netcom's storage devices, and these reproductions were sufficiently "fixed" to constitute recognizable copies under the Copyright Act
.
case, Netcom did not take any affirmative action that could result in copying of RTC's work. The mere fact that Netcom's system incidentally made temporary copies of plaintiff's work did not mean Netcom had caused the copying. The court further stated that although copyright was a strict liability statute, some element of volition or causation was still required to constitute copyright infringement. Since such element was lacking, Netcom was not liable for direct infringement.
The court also considered the negative consequences of holding Netcom directly liable. If Netcom was liable for making autonomous and incidental copies, this would result in liability for every single Usenet server in the worldwide link of computers transmitting Erlich's message to every other computer. The court concluded that there was no need to construe the Copyright Act to make all of these parties infringers.
The court also found that there was no logical reason to hold Netcom uniquely responsible for distributing Erlich's messages. Since every Usenet server had a role in distributing RTC's works, holding Netcom liable would mean liability for all these Usenet servers.
because of factual disputes.)
because of factual disputes.)
. The court held that imposing liability for copyright infringement
where it was otherwise appropriate did not necessarily raise a First Amendment issue, since the copyright
concepts of the idea/expression dichotomy
and the fair use
defense balanced the First Amendment and "promoting the progress of science and useful arts" clause of United States Constitution
.
has set out four nonexclusive factors.
because of factual disputes.)
because of factual disputes), and that RTC's claims of direct and vicarious infringement failed.
as a portion of Digital Millennium Copyright Act
("DMCA"). The same report also refers to this case as "the leading and most thoughtful judicial decision to date" on this subject.
Costar Group, Inc. v. Loopnet, Inc.
, 373 F.3d 544 (4th Cir. 2004) held that the DMCA did not supplant or preempt the holdings of this case.
Religious Technology Center
The Religious Technology Center is a Californian non-profit corporation. RTC was founded in 1982 by the Church of Scientology in order to control and oversee the use of all of the trademarks, symbols and texts of Scientology and Dianetics, including the copyrighted works of Scientology founder and...
v. Netcom On-Line Communication Services, Inc.
Netcom (USA)
NETCOM On-Line Communication Services, Inc. was an Internet service provider headquartered in San Jose, California.It was established in 1988 by Bob Rieger, an information systems engineer for Lockheed and Bill Gitow of System V. Netcom started off in San Jose, California as a service to allow...
, 907 F. Supp. 1361
Case citation
Case citation is the system used in many countries to identify the decisions in past court cases, either in special series of books called reporters or law reports, or in a 'neutral' form which will identify a decision wherever it was reported...
(N.D. Cal. 1995), is a U.S. district court
United States district court
The United States district courts are the general trial courts of the United States federal court system. Both civil and criminal cases are filed in the district court, which is a court of law, equity, and admiralty. There is a United States bankruptcy court associated with each United States...
case about whether the operator of a computer bulletin board service ("BBS
Bulletin board system
A Bulletin Board System, or BBS, is a computer system running software that allows users to connect and log in to the system using a terminal program. Once logged in, a user can perform functions such as uploading and downloading software and data, reading news and bulletins, and exchanging...
") and Internet access provider that allows that BBS to reach the Internet should be liable for copyright infringement committed by a subscriber of the BBS. The plaintiff Religious Technology Center ("RTC") argued that defendant Netcom was directly, contributorily, and vicariously
Vicarious liability
Vicarious liability is a form of strict, secondary liability that arises under the common law doctrine of agency – respondeat superior – the responsibility of the superior for the acts of their subordinate, or, in a broader sense, the responsibility of any third party that had the "right, ability...
liable for copyright infringement
Copyright infringement
Copyright infringement is the unauthorized or prohibited use of works under copyright, infringing the copyright holder's exclusive rights, such as the right to reproduce or perform the copyrighted work, or to make derivative works.- "Piracy" :...
. Netcom moved for summary judgment
Summary judgment
In law, a summary judgment is a determination made by a court without a full trial. Such a judgment may be issued as to the merits of an entire case, or of specific issues in that case....
(i.e., Netcom urged the court to make a judgment without a full trial
Trial (law)
In law, a trial is when parties to a dispute come together to present information in a tribunal, a formal setting with the authority to adjudicate claims or disputes. One form of tribunal is a court...
), disputing RTC's claims and raising a First Amendment
First Amendment to the United States Constitution
The First Amendment to the United States Constitution is part of the Bill of Rights. The amendment prohibits the making of any law respecting an establishment of religion, impeding the free exercise of religion, abridging the freedom of speech, infringing on the freedom of the press, interfering...
argument and a fair use
Fair use
Fair use is a limitation and exception to the exclusive right granted by copyright law to the author of a creative work. In United States copyright law, fair use is a doctrine that permits limited use of copyrighted material without acquiring permission from the rights holders...
defense. The district court of the Northern District of California
United States District Court for the Northern District of California
The United States District Court for the Northern District of California is the federal United States district court whose jurisdiction comprises following counties of California: Alameda, Contra Costa, Del Norte, Humboldt, Lake, Marin, Mendocino, Monterey, Napa, San Benito, San Francisco, San...
concluded that RTC's claims of direct and vicarious infringement failed, but genuine issues of fact precluded summary judgment on contributory liability and fair use. (I.e., facts about contributory liability and fair use that required adjudication by trial
Trial (law)
In law, a trial is when parties to a dispute come together to present information in a tribunal, a formal setting with the authority to adjudicate claims or disputes. One form of tribunal is a court...
precluded the court from making a decision without a trial.)
Facts
Plaintiff RTC held copyrights in the unpublished and published works of L. Ron Hubbard, the late founder of the Church of ScientologyChurch of Scientology
The Church of Scientology is an organization devoted to the practice and the promotion of the Scientology belief system. The Church of Scientology International is the Church of Scientology's parent organization, and is responsible for the overall ecclesiastical management, dissemination and...
. Defendant Dennis Erlich was a vocal critic of the Church via the Usenet
Usenet
Usenet is a worldwide distributed Internet discussion system. It developed from the general purpose UUCP architecture of the same name.Duke University graduate students Tom Truscott and Jim Ellis conceived the idea in 1979 and it was established in 1980...
newsgroup
Newsgroup
A usenet newsgroup is a repository usually within the Usenet system, for messages posted from many users in different locations. The term may be confusing to some, because it is usually a discussion group. Newsgroups are technically distinct from, but functionally similar to, discussion forums on...
alt.religion.scientology ("a.r.s."). Erlich posted portions of copyrighted works of RTC on a.r.s.
Erlich gained his access to the Internet through defendant Tom Klemesrud's bulletin board service ("BBS"), which had approximately 500 paying users. Klemesrud's BBS was linked to the Internet through the facilities of defendant Netcom. When Erlich posted messages to Usenet, he transmitted his messages to Klemesrud's computer using a telephone and a modem, and the messages were briefly stored on Klemesrud's computer. Then the messages were automatically copied from Klemesrud's computer to Netcom's computers and other computers on the Usenet according to a prearranged pattern. Once the messages were on Netcom's computers, they were available to Netcom's customers to download. The messages were stored on Netcom's system for eleven days and Klemesrud's system for three days.
RTC failed to persuade Erlich to stop his postings, and contacted Klemesrud and Netcom. Klemesrud asked RTC to prove that it owned the copyright to the works posted by Erlich, but RTC refused. Netcom similarly refused RTC's request that Erlich not be allowed to access the Internet through its system.
Direct infringement
RTC alleged that Netcom was directly liable for making copies of its works. RTC also alleged that Netcom violated its exclusive rights to publicly display copies of its works. In the oral argument, RTC argued that Netcom violated its exclusive right to publicly distribute its works.Creation of Fixed Copies
MAI Systems Corp. v. Peak Computer, Inc.MAI Systems Corp. v. Peak Computer, Inc.
MAI Systems Corp. v. Peak Computer, Inc., 991 F.2d 511 , was a case heard by the United States Court of Appeals for the Ninth Circuit which addressed the question of whether or not the loading of a software program into RAM by a computer repair technician makes a copy of the software that is a...
established that the loading of data from a storage device into RAM
Ram
-Animals:*Ram, an uncastrated male sheep*Ram cichlid, a species of freshwater fish endemic to Colombia and Venezuela-Military:*Battering ram*Ramming, a military tactic in which one vehicle runs into another...
constituted copying, because that data stayed in RAM long enough for it to be perceived. Erlich's act of sending a message to a.r.s. caused reproductions of portions of plaintiffs' work on both Klemesrud's and Netcom's storage devices, and these reproductions were sufficiently "fixed" to constitute recognizable copies under the Copyright Act
Copyright Act of 1976
The Copyright Act of 1976 is a United States copyright law and remains the primary basis of copyright law in the United States, as amended by several later enacted copyright provisions...
.
Liability for Making Copies
The court refused to impose direct liability on Netcom for making copies. The court first reasoned that in contrast with the MAIMAI Systems Corp. v. Peak Computer, Inc.
MAI Systems Corp. v. Peak Computer, Inc., 991 F.2d 511 , was a case heard by the United States Court of Appeals for the Ninth Circuit which addressed the question of whether or not the loading of a software program into RAM by a computer repair technician makes a copy of the software that is a...
case, Netcom did not take any affirmative action that could result in copying of RTC's work. The mere fact that Netcom's system incidentally made temporary copies of plaintiff's work did not mean Netcom had caused the copying. The court further stated that although copyright was a strict liability statute, some element of volition or causation was still required to constitute copyright infringement. Since such element was lacking, Netcom was not liable for direct infringement.
The court also considered the negative consequences of holding Netcom directly liable. If Netcom was liable for making autonomous and incidental copies, this would result in liability for every single Usenet server in the worldwide link of computers transmitting Erlich's message to every other computer. The court concluded that there was no need to construe the Copyright Act to make all of these parties infringers.
Public Distribution and Display
The court held that because the BBS merely stored and passed along all messages sent by its subscribers automatically and indiscriminately, the BBS should not be seen as causing these works to be publicly distributed or displayed. Similar to the creation of fixed copies, since there was no causation, Netcom should not be held liable for copyright infringement.The court also found that there was no logical reason to hold Netcom uniquely responsible for distributing Erlich's messages. Since every Usenet server had a role in distributing RTC's works, holding Netcom liable would mean liability for all these Usenet servers.
Conclusion
The court held that it could not see any meaningful distinction between what Netcom did and what every other Usenet server did. Adopting a rule that held Netcom liable could lead to the liability of countless parties whose role in the infringement was nothing more than setting up and operating a system that was necessary for the functioning of the Internet.Contributory Infringement
Contributory infringement can be established if the defendant has knowledge of the infringing activity and induces, causes or materially contributes to the infringing conduct of another.Knowledge of Infringing Activity
The court held that if RTC could prove that Netcom had knowledge of the infringing activities, Netcom could be liable for contributory infringement since its failure to simply cancel Erlich's infringing message and thereby stop an infringing copy from being distributed could constitute substantial participation. However, there was a question of fact as to whether Netcom knew or should have known that such activities were infringing after receipt of RTC's letter. This genuine issue of fact precluded summary judgment on contributory liability. (I.e., the court could not make a decision on contributory liability without trialTrial (law)
In law, a trial is when parties to a dispute come together to present information in a tribunal, a formal setting with the authority to adjudicate claims or disputes. One form of tribunal is a court...
because of factual disputes.)
Substantial Participation
The court held that Netcom did not completely relinquish control over how its system could be used. If Netcom could take simple measures to prevent further damage to RTC's copyrighted work, yet continued to aid in the accomplishment of Erlich's purpose of publicly distributing the postings, the participation of Netcom would be substantial.Vicarious Liability
A defendant is liable for vicarious liability for the actions of a primary infringer if the defendant (1) has the right and ability to control the infringer's acts and (2) receives a direct financial benefit from the infringement.Right and Ability to Control
RTC claimed that Netcom's terms of service specified that Netcom reserved the right to take remedial actions against subscribers. Netcom argued that it could not possibly screen messages before they were posted, and it had never exercised control over the content of users' postings. RTC disputed Netcom's claims. The court concluded that RTC raised a genuine issue of fact as to whether Netcom had the right and ability to exercise control over the activities of its subscribers. (I.e., the court could not make a decision on this issue without trialTrial (law)
In law, a trial is when parties to a dispute come together to present information in a tribunal, a formal setting with the authority to adjudicate claims or disputes. One form of tribunal is a court...
because of factual disputes.)
Direct Financial Benefit
The court held that Netcom did not receive direct financial benefit, because Netcom received only a fixed fee, and there was no evidence that infringement by Erlich in any way enhanced the value of Netcom's services to subscribers or attracted new subscribers. Since RTC failed to prove that Netcom received direct financial benefit from the infringing activity, RTC's claim of vicarious liability failed.First Amendment Argument
Netcom argued that RTC's theory of liability contravened the First AmendmentFirst Amendment to the United States Constitution
The First Amendment to the United States Constitution is part of the Bill of Rights. The amendment prohibits the making of any law respecting an establishment of religion, impeding the free exercise of religion, abridging the freedom of speech, infringing on the freedom of the press, interfering...
. The court held that imposing liability for copyright infringement
Copyright infringement
Copyright infringement is the unauthorized or prohibited use of works under copyright, infringing the copyright holder's exclusive rights, such as the right to reproduce or perform the copyrighted work, or to make derivative works.- "Piracy" :...
where it was otherwise appropriate did not necessarily raise a First Amendment issue, since the copyright
Copyright
Copyright is a legal concept, enacted by most governments, giving the creator of an original work exclusive rights to it, usually for a limited time...
concepts of the idea/expression dichotomy
Idea-expression divide
The idea–expression divide or idea–expression dichotomy limits the scope of copyright protection by differentiating an idea from the expression or manifestation of that idea.The case of Baker v. Selden was the first U.S...
and the fair use
Fair use
Fair use is a limitation and exception to the exclusive right granted by copyright law to the author of a creative work. In United States copyright law, fair use is a doctrine that permits limited use of copyrighted material without acquiring permission from the rights holders...
defense balanced the First Amendment and "promoting the progress of science and useful arts" clause of United States Constitution
United States Constitution
The Constitution of the United States is the supreme law of the United States of America. It is the framework for the organization of the United States government and for the relationship of the federal government with the states, citizens, and all people within the United States.The first three...
.
Fair Use Defense
The court considered whether the actions of Netcom qualified as fair use. The Copyright ActCopyright Act of 1976
The Copyright Act of 1976 is a United States copyright law and remains the primary basis of copyright law in the United States, as amended by several later enacted copyright provisions...
has set out four nonexclusive factors.
Purpose and character of the use
The court held that although Netcom's use was to carry out its commercial function as an Internet access provider, the use benefited the public in allowing for the functioning of the Internet. The court also held that since financial incentive was unrelated to the infringing activity, the commercial nature of the use should not be dispositive. Furthermore, Netcom's use of copyrighted material served a completely different function than that of the plaintiffs. Therefore, this factor weighed in favor of fair use.Nature of the copyrighted work
The works used were unpublished and creative. However, since Netcom's use of the works was merely to facilitate their posting to the Usenet, which was an entirely different purpose than plaintiff's use, the nature of the works was not important to the fair use determination.Amount and substantiality of portion used
Citing Sony v. Universal, the court stated that the mere fact that all of a work was copied was not determinative of the fair use question. The court held that since Netcom copied no more than necessary to function as a Usenet server, this factor should not defeat an otherwise valid defense.Effect of the use upon the potential market for or value of the copyrighted work
Netcom urged the court to focus on the "normal market" for the copyrighted work, which was through a Scientology-based organization. RTC responded that online distribution had the effect of market substitution. The court held that evidence raised a genuine issue of fact as to the possibility of market harm, which precluded summary judgment. (I.e., the court could not make a decision on this factor without trialTrial (law)
In law, a trial is when parties to a dispute come together to present information in a tribunal, a formal setting with the authority to adjudicate claims or disputes. One form of tribunal is a court...
because of factual disputes.)
Conclusion
The court concluded that genuine issues of fact precluded summary judgment on contributory copyright infringement liability and Netcom's fair use defense (i.e., the court could not make a decision on contributory infringement and Netcom's fair use defense without trialTrial (law)
In law, a trial is when parties to a dispute come together to present information in a tribunal, a formal setting with the authority to adjudicate claims or disputes. One form of tribunal is a court...
because of factual disputes), and that RTC's claims of direct and vicarious infringement failed.
Codification
According to H. Rept. 105-551, the case was codified in Online Copyright Infringement Liability Limitation ActOnline Copyright Infringement Liability Limitation Act
The Online Copyright Infringement Liability Limitation Act is United States federal law that creates a conditional safe harbor for online service providers and other Internet intermediaries by shielding them for their own acts of direct copyright infringement as well as...
as a portion of Digital Millennium Copyright Act
Digital Millennium Copyright Act
The Digital Millennium Copyright Act is a United States copyright law that implements two 1996 treaties of the World Intellectual Property Organization . It criminalizes production and dissemination of technology, devices, or services intended to circumvent measures that control access to...
("DMCA"). The same report also refers to this case as "the leading and most thoughtful judicial decision to date" on this subject.
Costar Group, Inc. v. Loopnet, Inc.
CoStar v. LoopNet
CoStar Group, Inc. v. LoopNet, Inc., 373 F.3d 544 , is a United States Court of Appeals for the Fourth Circuit decision about whether LoopNet should be held directly liable for CoStar’s copyrighted photographs posted by LoopNet’s subscribers on LoopNet’s website...
, 373 F.3d 544 (4th Cir. 2004) held that the DMCA did not supplant or preempt the holdings of this case.
See also
- Digital Millennium Copyright ActDigital Millennium Copyright ActThe Digital Millennium Copyright Act is a United States copyright law that implements two 1996 treaties of the World Intellectual Property Organization . It criminalizes production and dissemination of technology, devices, or services intended to circumvent measures that control access to...
- Online Copyright Infringement Liability Limitation ActOnline Copyright Infringement Liability Limitation ActThe Online Copyright Infringement Liability Limitation Act is United States federal law that creates a conditional safe harbor for online service providers and other Internet intermediaries by shielding them for their own acts of direct copyright infringement as well as...
- List of leading legal cases in copyright law
- Scientology and the legal systemScientology and the legal systemThe Church of Scientology has been involved in court disputes in several countries. In some cases, when the Church has initiated the dispute, question has been raised as to its motives. The Church says that its use of the legal system is necessary to protect its intellectual property and its right...
- Costar Group, Inc. v. Loopnet, Inc.CoStar v. LoopNetCoStar Group, Inc. v. LoopNet, Inc., 373 F.3d 544 , is a United States Court of Appeals for the Fourth Circuit decision about whether LoopNet should be held directly liable for CoStar’s copyrighted photographs posted by LoopNet’s subscribers on LoopNet’s website...
, 373 F.3d 544 (4th Cir. 2004).
External links
- Religious Tech. Ctr. v. Netcom On-Line Commc'n Servs., Inc., 907 F. Supp. 1361 (N.D. Cal. 1995).
- A law review article about DMCA Safe Harbor
- An introduction of secondary liability for copyright infringement by Professor Jane Ginsburg
- BBC documentary on the case.