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Providing Wonder Kit for Binge-Watching or Cloud Karaoke Machines May Be Deemed Copyright Infringement
A person may face a criminal liability of up to two years' imprisonment sentence for copyright infringement if he/she provided a software for use in setup boxes or app (so-called "wonder kit for binge-watching") or cloud Karaoke machines that facilitate users to access infringing audio/visual works. In the past, such persons were found not guilty because they could not be proven as having "knowingly" offered the software linking to infringing works. However, the Supreme Court rendered a judgment on 9 August 2023, holding that if the accused had intentionally refrained from verifying the copyright infringement claim, the accused may still be deemed to have knowingly infringed the copyright (Supreme Court's civil judgment 112-Tai-Shang-256).
Based on the principle of technological neutrality, a software provider does not necessarily assume the liability for others' copyright infringement by using the software provided by him/her. A software provider will be deemed infringing copyright if he/she profits from (1) offering the public a software with the intent to facilitate their public transmission or reproduction of infringing works (such as providing a P2P transmission software to facilitate users' exchange of such works); or (2) offering the public a software that can link to an assemble of works publicly broadcast or transmitted by another, with the intent to facilitate the public's access to such works, knowing that another's public broadcasting or transmission of such works would constitute copyright infringement (such as providing a setup box installed with a wonder kit or APP for users to link to an infringing website (Items 7 and 8, Paragraph 1, Article 87 and Item 4, Article 93 of the Copyright Act).
According to the legislature's explanation on the stipulation of Item 7, Paragraph 1, Article 87 of the Copyright Act, a technology provider will be subject to the liability for copyright infringement only if he/she provides the technology with the intent to facilitate others' copyright infringement. As intent is an individual's subjective state of mind and is difficult to be verified, it needs to be inferred objectively from the individual's activities such as advertising or proactively soliciting, enticing or inciting the public to use the technology to infringe others' copyright. The legislature has also pointed out that in drafting this stipulation, reference was made to the US Supreme Court's judgment on Grokster's case, which states that, "…one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties."
According to a judgment rendered by the Kinmen District Court on 14 July 2023, the accused installed a link to an infringing website in Karaoke machines and profited from renting such machines to KTV businesses for non-specific consumers to sing the songs selected by them via Internet by linking to its PRC licensor's cloud database. The court ruled as follows:
1. The accused was confirmed to have provided a software that enabled the linking to an assemble of infringing works: The accused argued that the app installed in the Karaoke machines can only link to its licensor's database and does not assemble the songs from different sources. However, the court ruled that the "assemble" stipulated under Item 8, Paragraph 1, Article 87 of the Copyright Act refers to the assembling of infringing works via link(s) in the software, and whether or not the software assembles different links to the works does not change the fact that the copyright to the works was infringed. Hence, the so-called assemble is not limited to the situation where specific songs can be accessed via different links.
2. The accused was not found guilty because his intent to infringe copyright could not be proven: The court found that the copyright declaration and the license agreement submitted by the accused do state that the licensor guaranteed that it had been duly licensed to provide the songs to the accused and that there was no copyright infringement. Hence there is the difficulty to prove the accused's awareness of the copyright infringement or intent to offer the public an access to infringing works (Kinmen District Court's criminal judgment 111-Chi-Yi-1).
According to the judgment rendered on another case by the Supreme Court on 9 August 2023, the appellee operated a "music restaurant" which had a Karaoke machine (provided by its PRC licensor) for consumers to sing the songs that were transmitted from the licensor's cloud database. The Supreme Court pointed out in its judgment that the constituent element, "knowingly", as stipulated under Item 8, Paragraph 1, Article 87 of the Copyright Act is an individual's subjective state of mind. An individual's mental state is hidden in his/her personal consciousness, can be perceived only by himself/herself, and cannot be directly experienced by third parties or proven by objective evidence. In addition to relying on the individual's statements, the court may, in the absence of direct evidence, look at the individual's external activities and surrounding circumstances to arrive at a comprehensive judgment based on a combination of indirect and circumstantial evidence, common sense, human nature, and empirical and theoretical principles. If the individual's lack of intent is solely due to his/her intentional or deliberate omission, he/she may still be deemed to have such intent (Supreme Court's civil judgment 112-Tai-Shang-256).
It is worth observing as to whether this Supreme Court judgement would help copyright holders' claims against copyright infringement. In the past, copyright holders could not claim against the suppliers of karaoke machines for copyright infringement because they argued that they relied on license agreements and thus lacked the intent to infringe copyright.