sharing networks, the files were stored on “spool” news servers operated by the defendants. The
defendants created designated servers for newsgroups containing music binary files to increase
their retention time over other types of Usenet files.^2170 The court granted the plaintiffs’ motion
for summary judgment on their claim for vicarious liability. Citing the Supreme Court’s
Grokster decision, the court noted that one may be vicariously liable if he has the right and
ability to supervise the infringing activity and also has a direct financial interest in such
activities. The court found that the defendants earned a direct financial benefit from the
infringement because their revenues increased depending on their users’ volume of downloads,
the majority of which had been shown to be infringing. The court noted also that the infringing
content on the service acted as a draw for users to subscribe to the service. The court rejected the
defendants’ argument that they lacked direct financial benefit from infringement because they
were paid on a per-volume, not per-download, basis and because infringing music accounted for
less than 1% of the newsgroups available on their service. The court noted that under the law,
the draw of infringement need not be the primary, or even a significant, draw – rather it need
only be “a” draw.^2171
The court ruled that the defendants had also failed to exercise their right and ability to
stop or limit infringement on their service. The defendants had in the past exercised their right
and ability to control their subscribers’ actions by terminating or limiting access of subscribers
who posted spam, restricted download speeds for subscribers who downloaded a
disproportionate volume of content, and taken measures to restrict users from posting or
downloading files containing pornography.^2172 “Defendants likewise have the right and ability to
block access to articles stored on their own servers that contain infringing content, but the record
does not show any instance of Defendants exercising that right and ability to limit infringement
by its users. More generally, Defendants have the right and ability to control which newsgroups
to accept and maintain on their servers and which to reject, an ability they chose to exercise
when they disabled access to approximately 900 music-related newsgroups in 2008.”^2173
Accordingly, the court found the defendants vicariously liable.^2174
(l) Corbis v. StarrIn Corbis Corp. v. Starr,^2175 the defendant Master, a janitorial maintenance company,
hired defendant West Central, an Internet services company, to redesign and host its web site.
The redesigned site contained four unauthorized images owned by the plaintiff Corbis. Corbis
sent a letter to Master notifying it of the infringing images, and Master responded by directing
West Central to remove the images, which West Central did. Corbis then filed suit against the
defendants for copyright infringement and moved for summary judgment. The court found West
(^2170) Id. at 130-31.
(^2171) Id. at 156-57.
(^2172) Id. at 157.
(^2173) Id.
(^2174) Id.
(^2175) 2009 U.S. Dist. LEXIS 79626 (N.D. Ohio Sept. 2, 2009).