The Chinese Search Engine Case: Busheng v. Baidu

This brief summary of Busheng v Baidu case is based on the news reports of the decision of the Haidian District Court of Beijing, not from the court’s original decision.

Busheng v Baidu

Decided by the Haidian District Court of Beijing on September 16, 2005
Baidu appealed after this decision
This summary is based on news reports of the decision of the Haidian District Court of Beijing

1. Fact

Plaintiff Shanghai Busheng Music Culture Media is a joint venture between EMI Group and a Chinese partner. Defendant Baidu, a NASDAQ-listed firm, is China’s leading search engine.
Plaintiff filed a suit against defendant claiming that Baidu offered a music download service on its website for 46 songs that copyrights owned by the plaintiff, this service harmed Busheng Music in its right and interests of distribution of these songs on the Internet. Plaintiff asked for 460,000 yuan (US$57,000) in compensation and demanded Baidu make a public apology in the Legal Daily newspaper.

2. Issue

Whether defendant’s providing of download service of plaintiff’s copyrighted songs is an infringement of plaintiff’s exclusive right of distribution.

3. Defendant’s argument

Defendant Baidu argued that:
a. Defendant is a provider of search service; it provides search results for internet users’ inquiry and usage.
b. Defendant did not provide download service for the 46 songs in this case.
c. Defendant’s search engine system provides search results automatically; it did not manually choose the links and pages or control the search result.

4. Rationale

The Haidian District Court held that:
a. Plaintiff is the copyright owner of 34 songs in this case.
Plaintiff provided evidence of five original CDs with copyright symbol on it. It has record management contract with the regarding artists, it has exclusive right to reproduce the copyrighted songs, the exclusive right to prepare derivative works and exclusive right to distribute these 34 songs.
Defendant did not provide any evidence against this.
b. Defendant infringed plaintiff’s right.
Defendant argued that it’s a neutral search engine service provider, it did not provide download service for the regarding songs in this case, but the court held that:
(1) The internet user did not visit the web pages containing the “song list” by sending request to the search engine, but simply clicked the links of “MP3”, “Artist List” and “Artist Name” showed on defendant’s website.
(2) The internet user can download MP3 files regarding this case by visiting the page of “song list”. During the download process, there will be a pop-up window show up containing advertisements of Nestlé Café and Motorola cellphone with indication that the MP3 file is from “mp3.baidu.com”.
(3) The downloaded MP3 files are derivative works of the songs on the CD. Defendant did not provide any evidence of agreement or license of downloading service from plaintiff.
In order to profit from it, defendant provided download service of plaintiff’s copyrighted works, this conduct is beyond the service scope of search engine, it infringed plaintiff’s exclusive right to distribute its work on information network. Defendant needs to stop this infringing activity and compensate for plaintiff’s damage.
c. Plaintiff did not provide enough evidence of copyright ownership in 12 of these 46 songs, the court did not support the plaintiff’s inquiry for this 12 songs.
d. The central issue of this case is plaintiff’s property right, not plaintiff’s personal right, the court did not support the plaintiff’s request for a public apology from the defendant.
Plaintiff asked for 460,000 yuan (US$57,000) in compensation, but did not give enough evidence to support it. The court determined otherwise the compensation according to the cost and profit in normal terms and the degree of defendant’s infringement.

5. Decision

According to the Copyright Law of the People’s Republic of China Article 40¹, Article 41², Article 47(4)³, and Article 48(2), the court decided that:
a. Upon the effectiveness of this decision, defendant stops providing downloading service of plaintiff’s 34 copyrighted songs regarding this case.
b. Defendant compensates plaintiff 68,000 yuan(2,000 yuan each song) within 10 days of the effectiveness of this decision.
c. Plaintiff’s other request dismissed.
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Article 40. When producing a sound recording or video recording, the producer shall conclude a contract with, and pay remuneration to, the performers.

Article 41. A producer of sound recordings or video recordings shall have the right to authorize others to reproduce, distribute, rent and communicate to the public on an information network such sound recordings or video recordings and the right to obtain remuneration therefore. The term of protection of such rights shall be fifty years, and expires on 3l December of the fiftieth year after the recording was first produced. Any one who is authorized to reproduce, distribute and communicate to the public on an information network a sound recording or video recording shall also obtain permission from, and pay remuneration to, the copyright owner and the performer as presented by regulations.

Article 47. Anyone who commits any of the following acts of infringement shall bear civil liability for such remedies as ceasing the infringing act, eliminating the effects of the act, making an apology or paying damages, depending on the circumstances’ and may, in addition, be subjected by a copyright administration department to such administrative penalties as ceasing the infringing act, confiscating unlawful income from the act, confiscating and destroying infringing reproductions and imposing a fine; where the circumstances are serious, the copyright administration department may also confiscate the materials, tools, and equipment mainly used for making the infringing reproductions; and if the act constitutes a crime, the infringer shall be prosecuted for his criminal liability:
(4) reproducing and distributing or communicating to the public on an information network a sound recording or video recording produced by another person, without the permission of the producer, unless otherwise provided in the Law;

Article 48(2). Where the right holder’s actual injury or infringer’s Unlawful income cannot be determined, the People’s Court shall Judge the damages not exceeding RMB 500, 00 depending on the circumstances of the infringing act.