copyright infringement, which is the standard of constructive knowledge under Sections 512(c)
and 512(d).^2875
Turning to the issue of control, the court ruled, citing Costar Group, Inc. v. Loopnet,
Inc.^2876 and Perfect 10 v. Cybernet Ventures, Inc.,^2877 that the mere ability to disconnect the
webmasters’ access to Internet Key’s service was not sufficient under the DMCA to demonstrate
a right and ability to control the infringing activity. Because no other control had been shown,
Internet Key was entitled to summary judgment under the Section 512(d) safe harbor.^2878
The parties filed an appeal of the rulings in this case with respect to CCBill and CWIE,
although not with respect to Internet Key. On appeal, CCBill argued that it should be entitled to
the immunity of Section 512(d) because, after processing a consumer’s credit card and issuing a
password granting access to a client website, it displayed a hyperlink so that the user could
access the client website. The Ninth Circuit rejected this argument, noting that, even if the
displayed hyperlink could be viewed as an information location tool, Section 512(d) provides a
safe harbor only for infringement of copyright by reason of the provider referring or linking
users to an online location containing infringing material or activity. Perfect 10 had not claimed
that CCBill infringed its copyrights by providing a hyperlink, but rather through CCBill’s
performance of other business services for the infringing websites. Accordingly, even if
CCBill’s provision of a hyperlink were immune under Section 512(d), CCBill could not receive
blanket immunity under Section 512(d) for its other services.^2879
g. Columbia Pictures v. FungIn Columbia Pictures Industries, Inc. v. Fung,^2880 the defendants operated BitTorrent sites
through which users could search indexes for dot-torrent files pointing to infringing movies and
other content. The district court found the defendants liable for inducement of infringement and
rejected assertion of a safe harbor under Section 512(d). The plaintiffs had established that the
defendants had reason to know of their users’ infringing activities (plaintiffs’ expert testified that
approximately 95% of downloads occurring through the defendants’ sites were downloads of
infringing content) and therefore the defendants had failed to establish the first requirement of
the Section 512(d) safe harbor that they were not aware of facts or circumstances from which
infringing activity was apparent.^2881 The court found that the defendants also had adequate
knowledge of infringing activity under the “red flag” test to have a duty to act to removing links
to infringing content. The defendants had not introduced any evidence that they acted
expeditiously to remove or disable access to infringing material. In addition, the court held the
(^2875) Id. at 1098.
(^2876) 164 F. Supp. 2d 688, 704 (D. Md. 2001), aff’d, 373 F.3d 544 (4th Cir. 2004).
(^2877) 213 F. Supp. 2d 1146, 1181 (C.D. Cal. 2002).
(^2878) Perfect 10 v. CCBill, 340 F. Supp. 2d at 1098.
(^2879) Perfect 10, Inc. v. CCBill LLC, 481 F.3d 751, 765-66 (9th Cir.), cert. denied, 552 U.S. 1062 (2007).
(^2880) 2009 U.S. Dist. LEXIS 122661 (C.D. Cal. Dec. 21, 2009), aff’d, 710 F.3d 1020 (9th Cir. 2013).
(^2881) Id. at 17 & 61.