a service may be aware that a fraction of the large volume of data exchanged over
its facilities involves unlawful activity, and might be able to detect a certain
portion of those, the threat of liability for failing to monitor effectively would, in
the judgment of Congress, deter companies such as eBay from making their
service available as widely and as freely as possible. ... In order for liability to
arise and the immunity to be lost, it would be necessary to show actual, rather
than constructive, knowledge of illegal sales, and some affirmative action by the
computer service, beyond making its facilities available in the normal manner,
designed to accomplish the illegal sales.^3017Accordingly, the court granted eBay’s motion for summary judgment. This case presents
an additional weapon of immunity against liability for service providers, at least to the extent that
claims are brought against the service provider under state law. Because many states have laws
that may be asserted against service providers for infringement committed through their services
- such as unfair competition laws and laws that protect sound recordings fixed before 1972
(when Congress added protection of sound recordings to the copyright statute) – the construction
of the CDA under Stoner v. eBay, if followed by other courts, could provide a very useful
grounds for immunity.
(b) Perfect 10 v. CCBillThe facts of Perfect 10, Inc. v. CCBill LLC^3018 are set forth in Section III.C.6(b)(1)(i)d.
above. In that case, Perfect 10 appealed rulings by the district court that CCBill and CWIE were
immune from liability for state law unfair competition and false advertising claims based on the
CDA. CCBill and CWIE cross appealed, arguing that the district court erred in holding that the
CDA did not provide immunity against Perfect 10’s right of publicity claims.^3019
The Ninth Circuit noted that, although the CDA does not provide service providers with
immunity from laws pertaining to intellectual property, it does not contain an express definition
of “intellectual property.” Because state laws protecting intellectual property are not uniform,
and because material on a website may be viewed across many states at a time, the court
reasoned that permitting the reach of any particular state’s definition of intellectual property to
dictate the contours of federal immunity under the CDA would be contrary to Congress’
expressed goal of insulating the development of the Internet from the various state-law regimes.
Thus, in the absence of a definition from Congress, the court construed the term “intellectual
property” in the CDA to mean “federal intellectual property.” Accordingly, CCBill and CWIE
were eligible for CDA immunity for all of the state claims raised by Perfect 10.^3020
(^3017) Id. at 1855.
(^3018) 481 F.3d 751 (9th Cir. 2007), cert. denied, 552 U.S. 1062 (2007).
(^3019) Id. at 757.
(^3020) Id. at 767-78.