ReDigi and the Volitional Conduct Element

While much is being written about the Capitol Records v. ReDigi memorandum and order that came out a few days ago, I want to focus on a bit of the opinion that caught my eye that (to my knowledge) no one else has mentioned. The court found that ReDigi—the service provider—had the requisite volitional conduct to hold it directly liable for copyright infringement even though its users were the ones who ultimately “pressed the button” and caused the copies to be made. This, as discussed below, is a rather remarkable result given the state of the law in the Second Circuit where the district court sits.

By way of background, Terry Hart at the Copyhype blog has a great write-up about ReDigi here. Defendant ReDigi operates a service wherein the public can buy and sell “used” digital music files. Plaintiff Capitol filed a complaint alleging that ReDigi violated its federal and common law copyrights. As to its federal claims, Capitol averred that ReDigi was directly liable for violation of its reproduction, distribution, public display, and public performance rights. It also maintained that ReDigi was indirectly liable for violation of its reproduction, distribution, and public display rights on theories of inducement, contributory, and vicarious infringement.

Capitol filed a motion for preliminary injunction and a memorandum of law in support. Google even tried to get in on the action, seeking leave of the court to file a brief as amicus curiae. The court denied the request, finding that “the parties are fully capable of raising these issues themselves—and have every incentive to do just that.” In a one-page order, Judge Richard J. Sullivan denied Capitol’s motion for preliminary injunction, incorporating his reasons as stated in the motion hearing by reference. The court found that in light of the Supreme Court’s opinion in eBay and the Second Circuit’s opinion in Salinger, “the lack of irreparable harm . . . really is the issue that causes me to deny the motion. It seems to me that money damages should be able to take care of all of this.” In the court’s opinion, since ReDigi kept records of the transactions that took place on its site, “there would be a record from which to calculate damages.”

Several months later, Capitol filed a motion for partial summary judgment, limiting its focus to infringement of the reproduction and distribution rights under federal copyright law. On the same day, ReDigi filed its own motion for summary judgment, asking the court to dismiss the claims against it. Public Knowledge, like Google before, tried to get in on the action, and it sought leave of the court to file a brief in support of ReDigi as amicus curiae. The court rejected the request, again stating that the parties were capable of addressing the issues themselves. After the briefing on the cross-motions for summary judgment was completed, the court held a hearing on the motions (which, by the way, is pretty funny and worth a read). Its memorandum and order on these motions is what came out a few days ago.

The Volitional Conduct Element

Copyright infringement is said to be a strict liability tort, meaning that intent to infringe is not a necessary element to establish a prima facie case of direct infringement.1 While noting that “[d]irect infringement does not require intent or any particular state of mind,” the district court in the seminal Netcom case held that “there should still be some element of volition or causation which is lacking where a defendant’s system is merely used to create a copy by a third party.”2 Important to the court’s analysis was the fact that the service provider “did not take any affirmative action that directly resulted in copying plaintiffs’ works other than by installing and maintaining a system whereby software automatically forwards messages received” from its subscribers.3

It was Netcom’s subscribers who “initiated the copying” using its equipment that could “operate without any human intervention.”4 Even though Netcom’s system “incidentally makes temporary copies of plaintiffs’ works,” said the court, it does not necessarily follow that the service provider “has caused the copying.”5 Thus, absent “some element of volition or causation,” the district court held that “the storage on a defendant’s system of infringing copies and retransmission to other servers is not a direct infringement” by the service provider “where such copies are uploaded by an infringing user.”6 The court noted that holding Netcom directly liable for the actions of its subscribers would mean holding “the entire Internet liable for activities that cannot reasonably be deterred.”7

The Netcom decision was followed by the Fourth Circuit in CoStar, wherein the court stated that direct infringement implies “a requirement of volition or causation by the purported infringer.”8 “While the Copyright Act does not require that the infringer know that he is infringing or that his conduct amount to a willful violation of the copyright owner’s rights,” said the court, “it nonetheless requires conduct by a person who causes in some meaningful way an infringement.”9 According to the court, it takes more than mere ownership of a machine used by others to establish direct liability: “There must be actual infringing conduct with a nexus sufficiently close and causal to the illegal copying that one could conclude that the machine owner himself trespassed on the exclusive domain of the copyright owner.”10

The court of appeals stated that “Netcom made a particularly rational interpretation of § 106 when it concluded that a person had to engage in volitional conduct—specifically, the act constituting infringement—to become a direct infringer.”11 The court, following Netcom, held that “the automatic copying, storage, and transmission of copyrighted materials, when instigated by others, does not render an ISP strictly liable for copyright infringement” under the Copyright Act.12 Thus, the Fourth Circuit further cemented into law the rule that a service provider that has no control over whether the copying of particular materials occurs cannot be directly liable for infringement.

In the famous Cablevision case,13 the Second Circuit considered whether defendant Cablevision could be a direct infringer by supplying its customers with a remote storage digital video recorder system. The district court below had held that it could, finding that it was Cablevision, and not its customers, that caused the copies to be made. The Second Circuit reversed, citing the Netcom and CoStar opinions and noting that those courts had quite reasonably read a volitional conduct element into what would otherwise be a strict liability statute. The court of appeals stated that when there is question as to which party is causing a copy to be made, courts should direct their “attention to the volitional conduct that causes the copy to be made.”14

The Second Circuit noted that there were two sets of volitional acts. First, Cablevision had designed, housed, and maintained the system used to produce the copies, and second, the customers had requested the system to create the copies. The court likened Cablevision’s customers to users of a traditional VCR, and it held that it would be perverse to make Cablevision accountable “for copies that are made automatically upon [a] customer’s command.”15 Just like the provider of a VCR would not be directly liable for the copies its customers cause, reasoned the court, so too was Cablevision not directly liable for the copies its customers would cause—notwithstanding Cablevision’s own contributions to the copying and its complete control over the use of its system.

Cablevision’s actions were far more proximate to the copying of particular materials than Netcom’s or the CoStar defendant’s ever were, and the rule from Netcom has been extended significantly past relieving mere passive conduits of liability for direct infringement. This leads to the potentially nefarious situation where no matter how instrumental a service provider’s actions may be in causing the unauthorized copying of particular materials—such as by Cablevision (1) supplying its customers with the source materials and the tools for the job, (2) making the copying as simple as pressing a virtual button, and (3) maintaining complete control over every aspect of its dedicated copy machine that existed for no purpose other than to make particular copies—that service provider would not be a direct infringer.

The precedent set by the foregoing cases indicates that no matter how many steps a service provider actually takes in helping its customers commit copyright infringement, it will not be held liable as a direct infringer so long as its customers initiate the very last step. That’s why it’s so remarkable that the district court here in Capitol Records v. ReDigi found ReDigi to be liable as a direct infringer. So how did the district court get past this precedent to find that ReDigi had engaged in the volitional conduct necessary to hold it directly liable for copyright infringement?

The Parties’ Arguments

In its memorandum of law in support of its motion for partial summary judgment, Capitol argued that ReDigi “engaged in ‘volitional conduct’ that transcends acting as a mere ‘passive conduit’ for the infringement of works selected by its users . . . .” Capitol adduced that ReDigi selected and screened each music file that was uploaded to its system, actively participating with its users in the infringing acts and encouraging them to utilize its service. This “level of intervention, oversight and encouragement,” urged Capitol, “plainly constitutes volitional conduct under the governing case law.” Capitol claimed that by goading its users to upload infringing files over which it had individualized control, ReDigi was more than a mere passive service provider.

In its memorandum of law in opposition to Capitol’s motion for partial summary judgment, ReDigi averred that even if “reproduction occurred during the upload process, ReDigi cannot be liable as a direct infringer as it has not engaged in ‘volitional conduct.’” It reasoned that under the Second Circuit’s holding in Cablevision, “[w]here a defendant merely houses and maintains a system where ‘copies’ can be made[,] some other conduct must be shown to demonstrate that the defendant operates the copying device.” It likened itself to a copy shop proprietor who has merely made his copy machines available to his customers. In such a situation, ReDigi claimed (while borrowing the analogy from Cablevision), the proprietor could not be held liable as a direct infringer since it would be the customers who made the copies.

ReDigi contended that there was no volitional conduct on its part where it provided a service that merely followed the commands of its users. Allowing its users to upload files, continued ReDigi, “is not conduct that is operational in a way that is more than Cablevision’s conduct, which the Second Circuit found did not confer direct liability on Cablevision.” ReDigi argued that its involvement in the selection and screening of each music file was no different than Cablevision’s selection and screening of the programming that it provided to its customers. Just because it had some say in which files were available on its system, ReDigi disputed that this made it the party who made the copies under the clear import of Cablevision.

In Capitol’s reply memorandum of law in support of its motion for partial summary judgment, it reiterated the argument that ReDigi had engaged in the requisite volitional conduct. Capitol claimed that ReDigi, unlike Cablevision, “does much more than ‘house’ a system used for copying.” It pressed that ReDigi scanned users’ computers for eligible digital music files, assisted users in uploading the files to offer them for sale, encouraged users to buy and sell the files, and searched for files to match other users’ specific requests. These facts, Capitol pointed out, were not contested by ReDigi. Thus, Capitol continued, ReDigi “does much more than passively ‘allow[] a user to command the system to upload files’” since it “urges and walks users through every stage of its infringing system.” Capitol concluded that this made ReDigi a direct infringer.

ReDigi’s Volitional Conduct

The briefing and motion hearing having been completed, the district court was faced with deciding whether ReDigi had engaged in the volitional conduct necessary to find it liable as a direct infringer in light of the Second Circuit’s opinion in Cablevision—binding precedent on the court since it sits in the Second Circuit. The court’s analysis on the direct liability issue was as follows:

To be liable for direct infringement, a defendant must have engaged in some volitional conduct sufficient to show that it actively violated one of the plaintiff’s exclusive rights. In other words, to establish direct liability under the Act, something more must be shown than mere ownership of a machine used by others to make illegal copies. There must be actual infringing conduct with a nexus sufficiently close and causal to the illegal copying that one could conclude that the machine owner himself trespassed on the exclusive domain of the copyright owner.

In Cartoon Network, the Second Circuit addressed whether the cable television provider Cablevision had directly infringed the plaintiff’s copyrights by providing digital video recording devices to its customers. The court determined that it had not. Though Cablevision had designed, housed, and maintained the recording devices, it was Cablevision’s customers who made the copies and therefore directly infringed the plaintiff’s reproduction rights. The court reasoned that, in determining who actually makes a copy, a significant difference exists between making a request to a human employee, who then volitionally operates the copying system to make the copy, and issuing a command directly to a system, which automatically obeys commands and engages in no volitional conduct. However, the court allowed that a case may exist where one’s contribution to the creation of an infringing copy is so great that it warrants holding that party directly liable for the infringement, even though another party has actually made the copy.

On the record before it, the Court concludes that, if such a case could ever occur, it has occurred with ReDigi. ReDigi’s founders built a service where only copyrighted work could be sold. Unlike Cablevision’s programming, which offered a mix of protected and public television, ReDigi’s Media Manager scans a user’s computer to build a list of eligible files that consists solely of protected music purchased on iTunes. While that process is itself automated, absolving ReDigi of direct liability on that ground alone would be a distinction without a difference. The fact that ReDigi’s founders programmed their software to choose copyrighted content satisfies the volitional conduct requirement and renders ReDigi’s case indistinguishable from those where human review of content gave rise to direct liability. Moreover, unlike Cablevision, ReDigi infringed both Capitol’s reproduction and distribution rights. ReDigi provided the infrastructure for its users’ infringing sales and affirmatively brokered sales by connecting users who are seeking unavailable songs with potential sellers. Given this fundamental and deliberate role, the Court concludes that ReDigi’s conduct transformed it from a passive provider of a space in which infringing activities happened to occur to an active participant in the process of copyright infringement. Accordingly, the Court grants Capitol’s motion for summary judgment on its claims for ReDigi’s direct infringement of its distribution and reproduction rights.16

This reasoning fascinates me. It’s not so much that I think Judge Sullivan did a good job of distinguishing Cablevision—he didn’t—but rather it’s because I think the Second Circuit in Cablevision misapplied its own test. The key is to go back to Netcom. The district court there held that Netcom could not be directly liable for infringement that occurred using its system since, as an internet access provider, it was truly a passive conduit that played no role in selecting or controlling the illicit content available to its subscribers over its system. Netcom in fact was just like a copy shop proprietor who merely made his copy machines available to the public. That some people may have infringed using the proprietor’s copy machines would not, without more, mean that the proprietor directly caused the copies to be made. His liability, if any, would be indirect.

The Second Circuit analogized Cablevision to such a copy shop proprietor, but the analogy missed the mark. A copy shop proprietor who merely provided his copy machines to the public played no part in selecting what got copied and had no control over how the machines were used. But where the copy shop proprietor played a more significant role in the copying, such as by operating the machines himself, he would be liable as a direct infringer for the copying that took place—even if the customers selected which materials were to be copied and even if the proprietor was merely fulfilling his customers’ requests.17 Cablevision didn’t just supply the copy machines, but rather it selected and supplied the very materials to be copied while maintaining complete control over its copy machines throughout the entire process.

The test for direct liability, formulated by the Fourth Circuit in CoStar and adopted by the Second Circuit in Cablevision, is whether there is “actual infringing conduct with a nexus sufficiently close and causal to the illegal copying that one could conclude that the machine owner himself trespassed on the exclusive domain of the copyright owner.”18 The nexus between Cablevision and the illicit copying was far more proximate than that of Netcom or of a copy shop proprietor who has made his copy machines available to the public. The only thing Cablevision’s customers did was make the requests; Cablevision did all the rest. The Second Circuit reasoned that there was insufficient volitional conduct on Cablevision’s part because it was its customers who pressed the button to initiate the copying. This underplays the significant volitional conduct that Cablevision engaged in by designing, housing, and maintaining its system that existed for no other purpose than to copy the very materials that it had selected and provided.

Judge Sullivan got it right when he noted that relieving ReDigi of direct liability because the processes involved were automated “would be a distinction without a difference.”19 Setting up a machine to do the very same task as a human does not completely erase the volitional conduct that goes into programming the machine. Judge Sullivan attempted to distinguish Cablevision by noting that (1) Cablevision offered protected and public works while ReDigi offered only protected works, and (2) ReDigi involved both the reproduction and distribution rights while Cablevision did not. Neither of these reasons is persuasive. First, it’s not at all clear that Cablevision offered any works that weren’t protected by copyright. Try as I might, I can’t find that distinction in the opinion. Nor do I see how it could possibly matter—whatever unprotected works may have been available on Cablevision’s system were irrelevant to the issue of the protected ones. Second, I don’t see how the fact that Cablevision didn’t involve the distribution right takes away from its discussion of the reproduction right. Cablevision addressed the public performance right as well, but that doesn’t mean that its discussion of the reproduction right is irrelevant.

Regardless, I think Judge Sullivan’s analysis of the volitional conduct element reflected, as the Second Circuit noted in Cablevision, that “the purpose of any causation-based liability doctrine is to identify the actor (or actors) whose conduct has been so significant and important a cause that he or she should be legally responsible.”20 Judge Sullivan recognized the absurdity of pretending that a service provider, who does 99% of the work in creating an illicit copy, does not in fact cause the copy to be made because a user does the other 1% by simply pressing a button. I think his application of Cablevision was perhaps faithless, but I think that Cablevision itself was faithless in its own application of the rule set forth in Netcom and CoStar. Judge Sullivan however, unlike the Second Circuit, was faithful in his commitment to causation-based tort principles.

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© 2013 Devlin Hartline. Licensed under the Law Theories Public License 1.0.

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  1. See, e.g., Buck v. Jewell-La Salle Realty Co., 283 U.S. 191, 198 (1931) (“Intention to infringe is not essential under the act.”); 3 Patry on Copyright § 9:5 (same). 
  2. Religious Tech. Ctr. v. Netcom On-Line Commc’n Services, Inc., 907 F.Supp. 1361, 1370 (N.D. Cal. 1995). 
  3. Id. at 1368. 
  4. Id
  5. Id. at 1368-69. 
  6. Id. at 1370-71. 
  7. Id. at 1372. 
  8. CoStar Group, Inc. v. LoopNet, Inc., 373 F.3d 544, 549 (4th Cir. 2004) (internal quotations omitted). 
  9. Id. (emphasis in original). 
  10. Id. at 550. 
  11. Id. at 551. 
  12. Id. at 555. 
  13. Cartoon Network LP, LLLP v. CSC Holdings, Inc., 536 F.3d 121 (2d Cir. 2008). 
  14. Id. at 131. 
  15. Id
  16. Capitol Records, LLC v. ReDigi Inc., No. 12-cv-00095, 2013 WL 1286134, *12 (S.D.N.Y. Mar. 30, 2013) (internal quotations, brackets, ellipses, and citations omitted). 
  17. See, e.g., RCA Records v. All-Fast Sys., Inc., 594 F.Supp. 335 (S.D.N.Y. 1984) (finding that copy shop proprietor who made copies at customer’s request of materials selected by customer was directly liable for infringement); Princeton Univ. Press v. Michigan Document Services, Inc., 99 F.3d 1381 (6th Cir. 1996) (same). 
  18. Cartoon Network, 536 F.3d at 130. 
  19. Capitol Records, 2013 WL 1286134 at *12. 
  20. Cartoon Network, 536 F.3d at 132 (internal quotations and brackets omitted). 

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