Why Did NCA Officials Attend Sohu.com’s Press Conference against Toutiao.com?

(By You Yunting) Recently, Sohu vs Toutiao has attracted attention from the media. Sohu sued Toutiao for copyright infringement and unfair competition, whilst Toutiao filed lawsuits against Sohu for defamation. It is quite normal for two enterprises in competition to take legal proceedings against each other. However, what really surprised us was, in their dispute, that governmental officials attended Sohu’s press conference, in favor of Sohu. In today’s post, we will discuss the reason for theimproper governmental interference. Comments and suggestions are most welcome.

  1. The process of governmental attending Sohu’s press conference

On June 24, Sohu held a press conference to announce that Sohu would sue Toutiao for copyright infringement and unfair competition. In Sohu’s press release, it said that some National Copyright Administration (the “NCA”) leaders attended the press conference. Moreover, a NCA official publicly expressed that it is absolutely impossible to carry something that belongs to other people without permission back home or direct trading, thus being the baseline of the Copyright Law and the red line between the Copyright Law and new technology application.(Note: the link is in Chinese)

On July 9, Toutiao started to fight back through instituting lawsuits for the defamation. Toutiao also claimed that whether or not Toutiao constituted infringement has not yet been defined legally but Sohu flatly declared that “Toutiao constituted infringement” before the court’s judgment and estimated Toutiao in insulting and derogatory terms. Under such circumstances, the conduct of Sohu cause serious damage to Toutiao’s reputation and commercial credit.

  1. What is the misconduct of the NCA official?

Toutiao’s claims are not entirely unjustified. If Sohu is replaced by NCA officials in Toutiao’s claim over a slight change, it seems easy to find that the NCA officials misconducted themselves, resulting from NCA attending Sohu’s press conference. As such, it could be expressed that NCA officials attended Sohu’s press conference and made an improper statement before the court’s judgment, interfering with the judiciary’s independence and underminingthe government’s neutral stance.

The fight between Sohu and Toutiao has already entered into legal proceedings. It is the court that shall be entitled to judge the rights and wrongs. Where the NCA officials attended, on behalf of the public authority, the press conference held by one party, it is improper. According to the evidences of exchange emails between Sohu and Toutiao provided by Toutiao, it cannot exclude that they have reached cooperation on using Sohu’s copyrighted news and reports for their fight. In case the evidence is acknowledged by the court, it is likely that Toutiao did not constitute copyright infringement.

  1. Why does NCA official make such misconduct?

Acting as a spectator, I don’t understand why Sohu would benefit from inviting NCA officials to attend its own press conference which itself is designed to crack down on its competitors. Despite being invited, NCA officials shall have known the negative effects of government image and taken risks of their own position in the future. Seen from the domestic governmental system, leadership at national level or big city level always behave themselves with caution. By comparison, why are NCA officials not so cautious in this way?

On the surface, public opinion is going against Toutiao. Toutiao is being investigated by NCA, when NCA behaved like that. Toutiao’s huge finance and its high valuation has attracted attention from traditional media, and its non-standard use of copyright at its growth stage incurred criticism from the whole traditional media, even being a public event. As well as traditional media, internet media and reporters also expressed criticism, thus Toutiao is at a disadvantage. As such, Toutiao has already been investigated by the NCA, and thus kept silent about NCA officials’ misconduct.

The underlying reason is that there is a lack of sufficient supervision and judicial remedies when it comes to the Internet. This has led to little possibility of NCA officials being punished for their misconduct. In China, internet supervision is mostly under the propaganda departments, such as NCA. The propaganda departments are responsible for the supervision of governments and the Communist Party of China by public opinions but they also shall be self-supervised. However, it is difficult for oneself to conduct self-supervision.

Meanwhile, the whole internet industry is being excessively supervised. The supervision departments have always acted in a strong position, so that, if there are few objectionable contents on a legal website, the regulators can shut it down without having to consider the 99.999 percent of legitimate and healthy contents.There are too many licenses and restrictions for enterprises to apply for in the internet industry. If there are a few contents inconsistent with regulations, when officials single them out, the private entrepreneur who has a net worth of millions yuan is also taken aback and keeps an uneasy silence without exception. The courts issued an inner regulation rejecting to accept the cases concerning posts deletion in the websites. Under such circumstances without sufficient supervision and remedy, it is difficult for regulators not to be arrogant. As such, is it a great event if the regulators attend a press release which may affect the position of governmental neutrality and judicial independence?

This incident offers a glimpse into the duality of rationality and irrationality in the internet industry. The rationality is the competition between enterprises, for example, the lawsuits of Toutiao vs Sohu fully showing the competition in the internet industry. The irrationality is industrial supervision, such as the misconduct of NCA officials indicating their decreasing judgment because of their arrogance. However, within the growth of social progress, the irrationality will be changed at last, just like NCA officials will never think that a lawyer like me may step forward and criticize their misconduct.

Finally, a conflictofinterest shall be disclosed to prevent Toutiao from being implicated. On June 21, three days before Sohu’s press conference, I was invited by Tencent’s Culture Department to attend a seminar on Toutiao’s copyright issues. One day before the seminar, I visited Toutiao and the Beijing News respectively to ask for background information. Hereby, for the avoidance of doubt, I have not had any cooperation with Toutiao until now.

Lawyer Contacts

You Yunting86-21-52134918  youyunting@debund.com/yytbest@gmail.com

Disclaimer of Bridge IP Law Commentary

Leave a Reply

Your email address will not be published. Required fields are marked *