The US Court of Appeal for the 9th Circuit (California) unanimously ruled yesterday that Gary Fung, the Canadian owner of BitTorrent website isoHunt, had "induced" users to download and distribute films and TV programmes, and that he could not rely on the DMCA safe harbor provisions for protection.Various film studios alleged that isohunt.com and related websites, all run by Fung, induced third parties to download infringing copies of the studios' works. The websites were all BitTorrent sites which enabled file sharing and IsoHunt, Fung's "flagship" site, went a step further by modifying torrent files to make them more reliable than when they were uploaded to the site. IsoHunt also hosted a forum where users could post comments; Fung would post comments and also moderated the forum.
The Court of Appeal affirmed the District Court's decision on liability, confirming that Fung had induced users to illegally download and distribute content and that the safe harbor provisions set out in the DCMA offered no protection.Two types of supporting evidence corroborated the conclusion that Fung "acted with a purpose to cause copyright violations": first, Fung took no steps "to develop filtering tools or other mechanisms to diminish the infringing activity" by those using his services. Second, Fung generated revenue almost exclusively by selling advertising space on his websites.
As regards whether Fung could make use of the safe harbor provisions, the Ninth Circuit was clear that it would be difficult for any defendant who induces copyright infringement to rely on safe harbor. It went on to say that Fung was ineligible because:1. He had "red flag knowledge" of the infringement. Red flag knowledge turns on whether a website provider is subjectively aware of facts that would have made the infringement "objectively" obvious to a reasonable person The court found that films and TV shows were "sufficiently current and well-known that it would have been objectively obvious to a reasonable person that the material solicited and assisted was both copyrighted and not licensed to random members of the public, and that the induced use was therefore infringing."
2. Fung profited from the infringement through advertising while having the "right and ability to control" infringing activity occurring through the various websites.The case will now go back to the District Court for a decision on damages and to finalise the injunction.
The decision is not surprising. Henry Hoberman, Senior Executive Vice President and Global General Counsel for the Motion Picture Association of America (MPAA) has said:
"This ruling affirms a core principle of copyright law: those who build businesses around encouraging, enabling, and helping others to commit copyright infringement are themselves infringers, and will be held accountable for their illegal actions. It also strikes an important blow in the fight to preserve the jobs of millions of workers in the creative industries, whose hard work and investments are exploited by rogue websites for their own profit."
However, according to Advanced Television, despite the injunction, isoHunt.com will continue to operate through private servers in Canada and it is the fourth most popular BitTorrent site on the Internet.The decision is available here.