RTC v. Netcom

Citation: Religious Technology Center v. Netcom On-Line Communication Servs., Inc., 907 F. Supp. 1361 (N.D. Cal. 1995).

Factual Background
The Religious Technology Center, an affiliate of the Church of Scientology sued Dennis Erlich, a former Scientology Minister who had allegedly posted copyrighted and confidential church materials on the Internet. Plaintiff also named the California bulletin board service ("BBS") on which the statements were published and Netcom On-Line Services, one of the largest providers of Internet access in the United States and the service through which the BBS accessed the Internet.

Trial Court Decision
Judge Whyte granted the BBS' and Netcom's motions for summary judgment on the issue of direct infringement because the actual copies made by their computers were not caused by any volitional acts on the part of Netcom or the BBS, but rather by Ehrlich's posting. In addition, the Court found that neither defendant was liable for vicarious infringement. Although plaintiff had raised a triable issue of fact with regard to the right and ability to control as to both defendants, it failed to show that Netcom enjoyed a direct financial benefit as a result of the infringement, and failed to plead that the BBS did.

The Court denied defendants' motions for summary judgment, however, on the contributory infringement claims finding that plaintiff had raised a triable issue of fact as to: (1) whether Netcom and the BBS knew or should have known Erlich was infringing plaintiff's copyrights after receiving a letter from plaintiff and if so, (2) whether defendants substantially participated in the [copyright infringement|infringement]] after receiving notice, and (3) whether defendants have a valid fair use defense.