(By You Yunting) Update: Apple made the following statement to the recently made court decision:

In AppStore, Chinese users could get more than 700,000 best apps from Apple developers. And as a holder of intellectual property, it has always been Apple’s awareness the importance of IPR protection, and thereby we carefully treat each infringement complaint. Apple cherishes the opinions and advices put forward by China Written Works Copyright Society, China Writers Association and Internet Society of China. For a better aid to the right protection of the content owners, Apple would continue improving the service quality.

According to Procuratorial Daily (Note: the link is in Chinese), Beijing No.2 Intermediate People’s Court made its decision in the 1st instance of the piracy dispute between Apple and two companies, seven Chinese authors on 27th December. As indicated in the opinions of the court, Apple has infringed the right of information network communication of the plaintiff’s work, and thereby it shall make a compensation of RMB 1, 035,000, namely USD 165,807.

By the report, in the hearing of the case, Apple defended itself over the alleged infringing apps on the following two reasons:

1. AppStore is run by Apple Luxembourg, and the business has no relation with Apple USA.

2. AppStore plays more role of a platform, and the App involved in the case is uploaded by the third party, and Apple shall not take any liability for the wrongdoing of them, and also the Safe Harbor Rule shall be applied.

Yet, as advocated by the plaintiff, the defendants including Apple made the uploading of the works independently or through the cooperation of the developers while with no license from the right holder. And AppStore has gained its interests from the public downloading of them. What the defendant has done has materially damaged the rights enjoyed by the right holder, including the right of works communication over the network. By the regulation on Protection of the Right to Network Dissemination of Information (the “Regulation”), the so-called right to network dissemination of information refers to the right to provide the public with the works, performances, or audio-visual recordings by wired or wireless means, so that the public may have access to these works, performances, and audio-visual recordings at a time and place chosen by the owner.

In the decision of the court, Apple shall be liable for the infringement occurred in AppStore, and in the meantime, it has also confirmed the plaintiff may enjoy the right to network dissemination of information. For the argument from Apple that the business in the store is not run by it, the court has refused to take it. Also we have seen the court ruled that the Safe Harbor Principle could not apply, which means the liability exemption could be enjoyed once deleted after the infringement notice. On the contrary, as believed by the court, Apple shall take a higher due care obligation over the downloadable apps in its App Store. But in the case, the failure of it to fulfill the obligation could lead to its infringement liability taking.

By the views of the author, AppStore has used the domain name and website of Apple, and therefore Apple shall of no excuse to take the liability of infringement. And in addition, by the Safe Harbor Principle related to the case, and we can see the regulation in Article 22 of The regulation on Protection of the Right to Network Dissemination of Information:

“Under the following circumstances, a network service provider that provides information storage space to a service object or provides works, performances, or audio-visual recordings to the public through the information network, shall not be liable for compensation:

1. Having clearly mentioned that the information storage space is provided to the service object, and also having publicized the name, contact information, and web address of the network service provider;

2. Having not altered the work, performance, or audio-visual recording provided to the service object;

3. Having not known and having no justified reason to know that the works, performances, or audio-visual recordings provided by the service object have infringed upon any other’s right;

4. Having not directly obtained economic benefits from the service object’s provision of the work, performance, or audio-visual recording;

5. After receiving the notification from the owner, having deleted the work, performance, or audio-visual regarded as infringing on the right of the owner according to the provisions of this regulation.”

Despite App Store meets some of the above conditions, items 3 and 4 inadequately satisfy the law. Apple reviews the app uploaded and sets the ranking of the apps, that means Apple have a higher care obligation, and in the mean time, AppStore has many charged apps and Apple could get 1/3 gains of them. So, the operator of AppStore is not the ISP as regulated in the Regulation, who shall be the seller and provider of content and service instead, and could not be duty exempted with reference to the laws. Therefore, Apple shall take joint liability with the infringing developer of the infringement.

Lawyer Contacts

You Yunting：86-21-52134918  youyunting@debund.com/yytbest@gmail.com

Disclaimer of Bridge IP Law Commentary

Short Link: