No. The company is not directly responsible for the copying. The court explained that to be directly guilty of copyright infringement, you have to be the one who actually caused it to happen. Giganews was more like the owner of a self-service copy machine. If someone comes in and illegally copies a book, the person using the machine is breaking the law, not the person who owns the machine. Giganews's system was completely automatic and only did things when a user uploaded something. Because Giganews didn't choose to copy the pictures itself, it wasn't the 'direct cause' of the illegal copying and therefore isn't directly liable.

No, Giganews and Livewire didn't break copyright laws. They didn't actually do anything themselves to cause the infringement - their systems just work automatically based on what users do. They also didn't really help or encourage people to share copyrighted stuff illegally. And even though they make money from their services, they don't make money specifically from sharing Perfect 10's pictures without permission. We agree with the lower court that Perfect 10's lawsuit wasn't right, and it's fair to make Perfect 10 pay for Giganews and Livewire's legal costs.

No. A Usenet provider that operates a passive, automated system at the direction of its users does not engage in the volitional conduct required to establish direct copyright infringement. The court clarified that the 'volitional conduct' requirement is not an element of intent but is a fundamental aspect of causation. For direct infringement, the defendant's own conduct must be the direct cause of the infringing act. Here, Giganews's system operates automatically; it copies, stores, and transmits materials only upon the instigation of its users. The court compared Giganews's system to a copying machine, where the user, not the machine's owner, is the direct infringer. Because Giganews did not select the content, instigate the copying, or exercise any control beyond the general operation of its service, it cannot be held directly liable for infringing Perfect 10's reproduction, display, or distribution rights. The court also rejected claims of secondary liability, finding Giganews did not materially contribute to the infringement because Perfect 10 failed to provide the 'simple measures' (machine-readable Message-IDs) for removal, nor did Giganews induce infringement. Finally, the vicarious infringement claim failed because Perfect 10 did not show Giganews received a direct financial benefit specifically from the availability of Perfect 10's images, as opposed to infringing content in general.

No. We affirm the district court's rulings in favor of Giganews and Livewire on all claims. For direct infringement, Perfect 10 failed to show that Giganews and Livewire engaged in volitional conduct that directly caused the infringement. Their operation of Usenet servers and provision of access were automated and controlled by users, not by Giganews or Livewire themselves. We reject Perfect 10's arguments on the display, distribution, and reproduction rights claims. For contributory infringement, even assuming Giganews had knowledge, Perfect 10 failed to show Giganews materially contributed to or induced infringement. There were no simple measures available that Giganews failed to take to remove infringing material, and no evidence Giganews distributed its product with the object of promoting infringement. For vicarious infringement, Perfect 10 failed to show Giganews received a direct financial benefit from the specific infringement of Perfect 10's works, as opposed to infringement generally. We also affirm the district court's fee award to Giganews and Livewire, finding it was within the court's discretion and consistent with the purposes of the Copyright Act. We reject Giganews and Livewire's arguments on cross-appeal regarding supplemental fees and adding Perfect 10's founder as an alter ego to the judgment.

Perfect 10, Inc. v. Giganews, Inc.

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