Megaupload May Be Liable for Direct Infringement, Court Rules

SAN DIEGO — Perfect 10 has scored a legal victory in its $5 million copyright suit against file-sharing membership site Megaupload, after a judge advanced the case by ruling that the file-storage site may be liable for direct and contributory infringement.

In Megaupload’s motion to dismiss, the judge upheld Perfect 10’s claims of direct and contributory infringement, but tossed the company’s vicarious and trademark claims.

According to the motion, Megaupload, which also operates sister sites Megarotic.com, Megaporn.com, Megavideo.com and Megaclick.com, argues that Perfect 10 had not alleged it engaged in volitional conduct sufficient  to hold it liable for direct infringement and maintains it is merely a passive conduit.

“Megaupload serves as more than a passive conduit and more than a mere file storage company,” Judge Irma Gonzalez wrote.

“It has created distinct websites, presumably in an effort to streamline users’ access to different types of media. It encourages and in some cases, pays its users to upload vast amounts of popular media through its Rewards Programs. It disseminates URLs for various files throughout the Internet. It provides payouts to affiliate websites that maintain a catalog of all available files and, at last, it is plausibly aware of the ongoing, rampant infringement taking place on its website.”

The suit, filed by Perfect 10 last February, said that Megaupload directs download links offering "tens of thousands of Perfect 10 copyrighted images, as well as Perfect 10 videos, to be juxtaposed on Megaupload affiliated websites, next to photographs and likenesses of Perfect 10 models and other models or celebrities."

The suit names Megaupload operator Kim Schmitz, who is described in the filing as a felon who has served time in prison for computer hacking and insider trading.

It also names 100 John Doe defendants, which are described as Megaupload's business partners or affiliates.

Megaupload and its sister sites have become increasingly popular through the past few years. Megaupload.com, according to the complaint, has become among the hundred most popular websites on the Internet, with a reported 45 million unique visitors per day.

Adult industry attorney Marc Randazza told XBIZ that he believes cyberlocker sites can be held liable for direct infringement.

"I have not seen a case in which one was held liable," Randazza said. "But this is an evolving area of the law and I think that Perfect 10's lawyers did a good job in educating the court."

Randazza said that Megaupload now has to work at defending its case, which includes engaging in discovery.

Related:  

Copyright © 2024 Adnet Media. All Rights Reserved. XBIZ is a trademark of Adnet Media.
Reproduction in whole or in part in any form or medium without express written permission is prohibited.

More News

Braindance Unveils '6DOF' VR Tech

Interactive virtual reality platform Braindance has debuted its new Six Degrees of Freedom (6DOF) VR technology.

Kiiroo, Pineapple Support Launch 'Empower Hour' Series on FeelHubX YouTube Channel

Kiiroo and Pineapple Support have teamed up to launch the “Empower Hour” series on the FeelHubX YouTube channel.

Kansas Law Firm Deploys Religion, Bunk Science While Recruiting Plaintiffs Under AV Law

Kansas-based personal injury law firm Mann Wyatt Tanksley is promoting debunked scientific theories and leveraging religious affiliation against the industry while it seeks potential plaintiffs for lawsuits against adult companies under the state’s age verification law.

UK Tech Secretary Lists Age Verification Among OSA Priorities

Peter Kyle, the U.K.’s Secretary of State for Science, Innovation and Technology, on Wednesday made public a draft version of his priorities for implementing the Online Safety Act (OSA), including age verification.

AEBN Publishes Popular Seraches by Country for September, October

AEBN has released its list of popular searches from its straight and gay theaters in all 50 states and the District of Columbia.

Avery Jane Featured on 'Adult Time Podcast'

Avery Jane is the latest guest on the “Adult Time Podcast,” hosted by studio CCO Bree Mills.

FSC: Kansas Law Firm Threatens Adult Site Over Age Verification

The Free Speech Coalition (FSC) has been notified that Kansas law firm Mann Wyatt Tanksley has sent a letter threatening an adult website with a lawsuit for breaking the state's age verification law.

10th Circuit Rejects Final FSC Appeal in Utah AV Case

The United States Court of Appeals for the 10th Circuit on Monday rejected a motion by Free Speech Coalition (FSC) requesting that the full court rehear its appeal in Free Speech Coalition v. Anderson, the industry trade association’s challenge to Utah’s age verification law.

Trump Nominates Project 2025 Contributor, Section 230 Foe to Chair FCC

President-elect Donald Trump has nominated, as his pick to head the Federal Communications Commission, Brendan Carr — an author of Project 2025 who has called for gutting Section 230 protections.

Streamate's Elevate Partners With Miss Mei on Decriminalization Initiative

Streamate’s Elevate initiative is debuting a November collaboration with creator and community advocate Miss Mei that will highlight the modern criminalization of sex work.

Show More