Erickson Productions, Inc. v. Kraig Kast
921 F.3d 822
9th Cir.2019Background
- Kast, owner of Atherton Trust, hired Only Websites to redesign Atherton Trust’s website; three Jim Erickson photographs licensed to Wells Fargo were copied onto the developmental site without a license.
- Erickson discovered the copies, sent a cease-and-desist in July 2011; Kast directed removal the next day but refused to pay damages.
- At trial, the jury found Kast not directly liable but both vicariously and contributorily liable for infringement and also found the infringement willful; statutory damages of $150,000 per photo (total $450,000) were awarded.
- Kast appealed, arguing (inter alia) that (1) avoidance of licensing fees does not constitute a direct financial benefit for vicarious liability, (2) the contributory-infringement knowledge instruction was improper, and (3) the willfulness instruction improperly used a negligence (“should have known”) standard.
- The Ninth Circuit vacated the vicarious-liability verdict (no direct financial benefit as a matter of law), affirmed contributory liability, and vacated the willfulness finding and remanded statutory-damages for reconsideration under the correct mental-state standard.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Vicarious liability — what constitutes a "direct financial benefit" | Erickson: Photos made Kast’s site more attractive, saved Kast licensing fees, and allowed a rushed launch — any of which provided a direct financial benefit. | Kast: No causal, direct financial benefit; avoidance of licensing fees by the direct infringer does not directly benefit Kast as a matter of law. | Vacated vicarious-liability verdict: avoided licensing fees, marginal attractiveness, and rushed launch did not constitute a direct financial benefit as a matter of law. |
| Contributory liability — required mental state for "knowledge" | Erickson: Jury instruction that knowledge may include "reason to know" (constructive knowledge) is proper. | Kast: "Knowledge" requires actual knowledge or willful blindness; a "reason to know" standard is too broad. | Affirmed contributory-liability verdict: even if tension exists in Ninth Circuit precedent, instruction was not plainly erroneous. |
| Willfulness for statutory damages — proper mental state | Erickson: "Should have known" (constructive knowledge) supports willfulness. | Kast: Willfulness requires actual knowledge, reckless disregard, or willful blindness; "should have known" is mere negligence and insufficient. | Reversed willfulness finding: "should have known" is a negligence standard and cannot support willfulness; remanded for determination under correct standard. |
| Evidentiary/procedural challenges (various) | Erickson defended discovery and evidentiary rulings as non-prejudicial and proper. | Kast argued multiple trial-court errors (discovery, character evidence, misnaming defendant). | Rejected Kast’s remaining challenges as non-prejudicial or without merit; Kast was a proper defendant. |
Key Cases Cited
- VHT, Inc. v. Zillow Group, Inc., 918 F.3d 723 (9th Cir. 2019) (vicarious/contributory liability framework)
- Perfect 10, Inc. v. Giganews, Inc., 847 F.3d 657 (9th Cir. 2017) (vicarious liability standard)
- Ellison v. Robertson, 357 F.3d 1072 (9th Cir. 2004) ("draw" inquiry for direct financial benefit)
- Luvdarts, LLC v. AT&T Mobility, LLC, 710 F.3d 1068 (9th Cir. 2013) (actual knowledge or willful blindness for contributory liability)
- Louis Vuitton Malletier, S.A. v. Akanoc Solutions, Inc., 658 F.3d 936 (9th Cir. 2011) ("know or have reason to know" contributory instruction cited)
- Global-Tech Appliances, Inc. v. SEB S.A., 563 U.S. 754 (2011) (distinguishing negligence from willful blindness/recklessness for mental-state standards)
- Unicolors, Inc. v. Urban Outfitters, Inc., 853 F.3d 980 (9th Cir. 2017) (willfulness requires actual knowledge or reckless disregard/willful blindness)
- A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004 (9th Cir. 2001) (contributory infringement principles)