Disney Enterprises, Inc. v. Hotfile Corp.
798 F. Supp. 2d 1303
S.D. Fla.2011Background
- Plaintiffs are major motion-picture studios alleging copyright infringement via Hotfile and Anton Titov's platform.
- Hotfile operates hotfile.com storing user-uploaded files; it generates links and multiple copies of each file.
- Hotfile monetizes via paid memberships, high-speed downloads, and a 'hotlinks' distribution model; it also pays uploaders and affiliates to promote popular content.
- Plaintiffs allege Hotfile's business model actively encourages infringement and facilitates widespread copying of copyrighted works.
- Defendants moved to dismiss Count I (direct infringement) and Count II (secondary infringement); the court granted in part and denied in part.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Direct infringement viability | Hotfile's volitional conduct induces infringement via its system and business plan. | Hotfile and Titov lack direct infringement because the system merely facilitates user uploads/downloads with no direct activity by defendants. | Count I dismissed for lack of direct infringement; no volitional act by Hotfile or Titov. |
| Secondary infringement sufficiency | Hotfile induces, contributes to, and vicariously infringes through its structured model. | Plaintiffs fail to plead inducement/contributory/vicarious liability adequately. | Counts for inducing, contributory, and vicarious infringement survive at pleading stage. |
| Titov's individual liability | Titov managed Hotfile, adopted the infringing model, and had financial interest in infringement. | Titov's liability not adequately shown under pleading standards. | Titov may be liable; pleading suffices to show supervision and financial interest in infringement. |
Key Cases Cited
- CoStar Group, Inc. v. LoopNet, Inc., 373 F.3d 544 (4th Cir. 2004) (direct infringement requires volitional conduct; mere ownership of a platform is insufficient)
- Parker v. Google, Inc., 422 F.Supp.2d 492 (E.D. Pa. 2006) (automatic storage/transmission lacks volitional conduct)
- Cartoon Network, LP v. CSC Holdings, Inc., 536 F.3d 121 (2d Cir. 2008) (distinguishes active uploading from passive hosting)
- MGM Studios, Inc. v. Grokster, Ltd., 545 U.S. 913 (U.S. 2005) (inducement/secondary liability when distributing a device to promote infringement)
- N.Y. Times Co. v. Tasini, 533 U.S. 483 (U.S. 2001) (contextual guidance on infringement concepts; not controlling here but cited)
- Playboy Enters. v. Webbworld, Inc., 168 F.3d 486 (5th Cir. 1999) (discussion of selective uploading and infringement dynamics)
- Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 1146 (9th Cir. 2007) (passive hosting vs. active control considerations)
- Russ Hardenburgh, Inc. v. Hardenburgh, 982 F. Supp. 503 (N.D. Ohio 1997) (illustrates direct infringement with volitional acts)