Employing the standard set out by the New York Court of Appeals in internet copyright infringement cases, the U. S. Court of Appeals for the Second Circuit has revived a copyright infringement suit brought by a New York resident against a non-resident based upon defendant’s alleged uploading of copyrighted materials onto the internet. Penguin Group (USA) Inc. v. American Buddha, Case No. 09-1739 (2d Cir., May 12, 2011) (per curiam).
Plaintiff Penguin Group, a New York book publisher, sued defendant American Buddha, an Oregon corporation located in Arizona, for copyright infringement, in New York. Penguin Group alleged that American Buddha published complete copies of four of the plaintiff’s books on American Buddha’s websites. The defendant moved to dismiss the complaint for lack of personal jurisdiction, arguing that it lacked sufficient ties to New York and that the plaintiff had alleged no infringing activity within New York. The district court granted American Buddha’s motion to dismiss.
Due to a split of authority on the jurisdictional issue, the 2d Circuit certified a question the following New York’s highest court, its court of appeals: “In copyright infringement cases, is the situs of injury for purposes of determining long-arm jurisdiction under N.Y. C.P.L.R. § 302(a)(3)(ii) the location of the infringing action or the residence or location of the principal place of business of the copyright holder?” The New York Court of Appeals ultimately determined that in copyright infringement cases involving the uploading of a copyrighted printed literary work onto the internet, the injury caused by the infringement is suffered where the copyright owner is located—and not where the infringing material may have been uploaded from (see IP Update, Vol. 14, No. 4).
Based upon that New York Court of Appeals ruling, the 2d Circuit has now determined that the situs of the plaintiff’s alleged injury was New York, where the plaintiff resides. Accordingly, the 2d Circuit vacated the district court’s judgment for defendant and remanded the case for the district court to consider whether Penguin Group has established the four remaining jurisdictional requirements and the extent to which the exercise of jurisdiction over the defendant would be consistent with the requirements of due process.