Case 20
The Case of Dispute over the Infringement upon Copyright Through the Selling of Infringing Copyright Products by Network Shop on E-commerce Platform
Trial Docket: (2017) Min05MinChu No. 701
[Headnotes] The e-commerce platform provides network shop operators with a network platform and network service for selling goods. In the case where the operator’s sale of good is suspected of being involved in the infringement upon copyright, the network service provider should not bear joint infringing liability with direct infringer if, after the plaintiff’s complaint or initiation of lawsuit, the net,work service provider, according to relevant management rules formulated by itself, timely deletes the online sale information of the allegedly infringing products to fulfill its due diligence obligations as network service provider, and take necessary measures to stop infringement and has no negligence for the occurrence of the allegedly infringing act.
[Synopsis] Plaintiff: Quanzhou Softmoon Arts & Crafts Co., Ltd (Softmoon Company)
Defendant: A Ke, Zhejiang Taobao Network Co., Ltd. (Taobao Company)
As an employee at the plaintiff Softmoon Company, Ruan Xianzhao completed the creation of the fine art work “Animal Magnet A-4”, which is a work with the front head of a small yellow dog as the theme. Softmoon Company applied for copyright registration with the Fujian Provincial Copyright Bureau in August 2016, with Min Zuo Deng Zi-2016-F-00030527 as the registration number and Softmoon Company as the copyright owner. On April 12, 2017, the plaintiff bought, under notarization, the infringing products involved in the case from the shop of www.hangpin.com operated by A Ke on the platform of www.taobao.com.
The plaintiff brought a lawsuit in the Quanzhou Municipal Intermediate People’s Court of Fujian Province, arguing that the defendant A Ke, without authorization, reproduced and published the works which infringed upon the plaintiff’s copyright, and that the defendant Taobao Company knew the defendant A Ke’s infringement, but still allowed the allegedly infringing products to be sold on its website, due to which they co-conducted infringing acts, and as a result, they should bear the infringing liability.
The Quanzhou Intermediate People’s Court of first instance rendered a judgment to order the defendant A Ke to immediately stop the infringement and stop the sale of infringing products, pay 3,000 Yuan to the plaintiff as economic losses, and rejected the plaintiff’s other claims.
[Judge’s Comment] In this case, the court ruled, after trial, that, because his act of selling the products similar to the plaintiff’s fine art works without authorization infringed upon the plaintiff’s right of distribution, the defendant A Ke’s shall bear civil liability such as stopping the infringement and compensating for the damages, that the defendant Taobao Company had no negligence for the allegedly infringing act and shall not co-bear infringing liability with the defendant A Ke because it had fulfilled its obligations as network service provider by its timely deletion of the online sale information of the allegedly infringing product after the plaintiff’s complaint or initiation of the lawsuit, and that the plaintiff’s claim against Taobao Company shall be rejected.
At present, online shopping has become more and more popular, and more and more consumers buy goods from e-commerce platforms such as www.jd.com and www.taobao.com. While selling self-operated branded products, major e-commerce platforms have also gathered a large number of online retail store operators with diversified supply channels, and some of their products may infringe upon others’ copyright. Since the e-commerce platform provides online store operators with an online platform for selling goods and network services, when the products sold by the online store operators are suspected of infringing copyright, the e-commerce platform as network service provider may also be suspected of infringing the right to network dissemination of information. Where there is a dispute over the right to network dissemination of information, e-commerce platforms often quote the provisions of Article 22 of Regulation on the Protection of the Right to Network Dissemination of Information (the Regulation) to prove its being exempted from liability undertaking.
How to determine whether the e-commerce platform can be exempted from liability? In judicial practice, the following factors should be taken into account when applying Article 22 of the Regulation for determining the network service provider’s liability: (1) whether the network service provider has fulfilled its obligations to prompting and notification in a reasonable way; (2) whether the network service provider knows or ought to know the existence of the infringement facts; (3) whether the network service provider directly or indirectly conducts the infringement and directly obtains economic gains from the uploading of the contents and (4) whether the network service provider fulfills the removal obligation in a timely manner.
In this case, the court ascertained that Taobao Company publicized its name, contact person and website address on its “Taobao Platform”, that Taobao Company fulfilled its “obligations to prompting and notification”, that, in addition to its lack of infringing intent, Taobao Company had difficulty in finding and determining whether the infringing products involved in the case infringed upon others’ copyright or not because the products involved in the case were not popular products, that the sales income of the infringing products involved in this case was directly obtained by the network shop operator and Taobao Company obtained no direct economic gains from such selling, and that Taobao Company timely fulfilled its obligation to removal by its deletion of the network sale information of the allegedly infringing products after it received the litigation documents. The court ruled, after a comprehensive consideration of the above situations, that Taobao Company shall be exempted from bearing compensation liability because it had no negligence for the occurrence of the allegedly infringing act and because it had fulfilled the corresponding duty of negligence as network service provider and had taken necessary measures to stop the infringement.
（Translated by Zheng Xiaojun, Yuan Renhui)
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