Blue Nile, an online jewelry and diamond retailer, sued Ideal Diamond Solutions (IDS) for copyright infringement alleging that IDS used Blue Nile's copyrighted images on IDS' website and sought to hold IDS' founder, Larry Chasin, personally liable. The court held that as copyright infringement is a strict liability tort there is no corporate veil protection for corporate officers for copyright infringement and all persons who participate may be jointly and severally liable. Furthermore, the court rejected Chasin's defense that he did not know that the images used on the IDS website infringed on Blue Nile's copyrights because any infringer, whether intentional or innocent, is strictly liable. Finally, Chasin's defense that he did not personally create the infringing website was also rejected by the court, and refused to dismiss claims under the theory of vicarious liability because he had the right and ability to supervise the infringing activity and had a direct financial interest in the infringing activity.
TIP: A finding of intent to infringe is not required for copyright infringement. Advertisers should be sure to use original materials in advertising or obtain a license from the copyright holder.