Intellectual Property:  Overview

● Copyright

Section 102 of the Copyright Act allows protection of: "original works of authorship fixed in any tangible medium of expression, now known or later developed, from which they can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device." E-Law 3.0.1, citing Copyright Act of 1947, 17 U.S.C. §102(a) (1947).

§ Direct Infringers

Strict liability. Intent not relevant. E-Law 3.0.1.  To establish copyright claim must show: (1) ownership of valid copyright; (2) copying. Sega Enterprises Ltd. v. MAPHIA.

Central Point Software v. Nugent. Computer software designers brought a motion for summary judgment on a copyright infringement action against an operator of computer bulletin board.  Central.

Playboy Enterprises v Frena. Court found the BBS operator directly liable for the display and distribution of unauthorized copies to subscribers. Playboy.

Sega. Court issued preliminary injunction, finding prima facie case was established for direct copyright infringement based on the BBS operator’s permitting the uploading of copyrighted games onto the BBS.  Sega.

Religious Technology Center v. Netcom On-line Communications Services, Inc. Court found that neither Sega nor Playboy required a finding that Netcom be liable for direct infringement of Religious Technology’s exclusive right to produce their works. Court stated that Netcom cannot be liable for direct infringement. Religious.

§ Contributory Infringers

Not strict liability; no statutory rule. E-Law 3.0.1. "One who, with knowledge of infringing activity, induces, causes or materially contributes to infringing conduct of another may be held liable as contributory infringer."Sega citing Casella v. Morris.

Sega Enterprises Ltd. v. MAPHIA. Court issued preliminary injunction, finding prima facie case was established for contributory copyright infringement based on the operator’s role in copying the video games "including provision of facilities, direction, knowledge and encouragement." Sega.

Religious Technology Center v. Netcom On-line Communications Services, Inc. Court states "it is fair, assuming Netcom is able to take simple measures to prevent further damage to plaintiffs’ copyrighted works, to hold Netcom liable for contributory infringement where Netcom has knowledge of Erlich’s infringing postings yet continues to aid in the accomplishment of Erlich’s purpose of publicly distributing the posting." Religious.

§ Vicarious liability

Not strict liability. E-Law 3.0.1. Vicarious liability for actions of the primary infringer can arise when defendant: (1) has right and ability to control the primary infringer; and (2) receives a direct financial benefit from the infringement. Religious.

Religious Technology Center v. Netcom On-line Communications Services, Inc. Court found genuine issue of fact whether Netcom had the right and ability to control the activities of its subscribers. Religious.  Court also found that Plaintiffs failed to raise a question of fact regarding whether Netcom’s policy of either enforcing or not enforcing violations of copyright laws financially benefited Netcom therefore the claim for vicarious liability must fail. Religious.

§ Innocent Infringers Provision

Allows for reduction of damages. E-Law 3.0.1.

§ Fair Use Provision

Not all uses of copyrighted materials are infringing. This provision lists acceptable uses of copyrighted works and four factors to be considered when determining fair use. E-Law 3.0.1.

Sega Enterprises, Inc. v. MAPHIA. In order to use fair use exception, must possess authorized copy. Court considers the four factors in determining fair use. Sega.

Religious Technology Center v. Netcom On-line Communications Services, Inc. The District Court in California, after a detailed analysis of fair use, did not find that Netcom’s use was fair as a matter of law. Religious.

● Trademark Infringement and Unfair Competition

§ Trademark Infringement

Covered by U.S. Trademark law. To establish prima facie case for trademark infringement under Lanham Act must show: (a) mark is owned or associated with particular plaintiff; and (b) defendant's use of mark has caused public confusion or mistake. Sega.

§ Unfair Competition

Claims under the Lanham Act must establish that the public is likely to be confused by the similar marks.  Sega.

Sega Enterprises, Inc. v. MAPHIA. Court issued preliminary injunction, finding Sega was likely to prevail on trademark infringement, federal unfair competition, and false designation of origin based on the BBS operator’s permitting the uploading and encouraging downloading of copyrighted games onto the BBS. Sega.

Playboy Enterprises, Inc. v. Frena. Court found that Frena infringed Playboy’s federally registered trademarks Playboy and Playmate. Playboy. Also, by deleting some of Playboy’s text and photographs and inserting his own, Frena competed unfairly with Playboy. Playboy.

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Service Provider Liability Pages

Introduction • Table of Contents
Servcie Providers - Overview • Service Providers - Discussion • Liability Analogies - Overview • Liability Analogies - Discussion • Defamation - Overview • Defamation - Discussion • Intellectual Property - Overview • Intellectual Property - Discussion • Obscenity - Overview • Obscenity - Discussion • Criminal - Overview • Criminal Discussion • Privacy - Overview • Privacy - Discussion • Policy Discussion • Conclusion • Pocket Part • Notes & Links

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Prepared for Professor Laura Gasaway's Cyberspace Law Seminar (Law - 357C)
UNC School of Law - Spring 1997

By:  Ashe Lockhart (Webmaster) & Carol Kozar

Instructor: Laura N. Gasaway, Professor of Law and Director of the Katherine R. Everett Law Library

Copyright © 1997 Ashe Lockhart & Carol Kozar