Intellectual Property - Internet - Recent Developments

Perfect 10, Inc. v. Visa Intern. Service Ass’n, 2007 WL 1892885 (9^th Cir. July 3, 2007)

Perfect 10 alleged that numerous websites stole its images, altered them, and illegally offered them for sale online.  Instead of suing these direct infringers, however, Perfect 10 sued Visa, MasterCard and other entities that processed credit card payments to the allegedly infringing websites.  It asserted that these companies continued to process credit card charges for the infringing websites despite receiving repeated notices that specifically identified the infringing websites and informed the credit card companies that some of the sites’ consumers were using their credit cards to purchase infringing images. The District Court dismissed Perfect 10’s Complaint, and the Ninth Circuit affirmed. Over a vehement dissent by Judge Kozinski, a majority of the panel hearing the case ruled that the credit card companies could not be held secondarily or vicariously liable for copyright or trademark infringement for continuing to process charges made by purchasers of the pirated photos. To read the court’s decision, click here.