What Results Have Been Obtained in the Internet-Related Copyright Litigation?

A short briefing concerning each of the cases brought for copyright infringement of L. Ron Hubbard's works by the exclusive licensees of his copyrights is below. They are listed in the order that they were filed. As can been seen clearly, the results obtained through our efforts benefit all owners of intellectual properties, not just the Scientology churches.

A. Religious Technology Center and Bridge Publications, Inc. v. Netcom On-Line Communication Services, Inc.

This was the first Internet-related case brought by any of the licensees concerning copyright infringements. In this case, an ex-Scientologist posted confidential Advanced Technology works and published works on the Internet in August 1994 and then again in December 1994, through a bulletin board service, which accessed the Internet through an access provider, NETCOM On-Line Communication Services, Inc. As a result, when RTC and BPI were unsuccessful in obtaining the infringer's agreement or the assistance of either the bulletin board system or NETCOM to put a stop to the infringements, suit was filed by RTC and BPI against all three in federal court in San Jose, California.

In ruling in November 1995 on a motion to dismiss the complaint field by the bulletin board system and a motion for summary judgment filed by NETCOM, the Court held that an access provider that knows of infringement through its system and takes no action to stop it may also be held liable. NETCOM later settled with RTC and adopted a protocol, which it posted on its web site, for handling all complaints of copyright infringement.

The precedent established by the Court's ruling that an access provider can be held liable where it knows of an infringement, but takes no action to stop it, and the protocol that Netcom then adopted in connection with its settlement with RTC led to Congress taking action to incorporate a like provision into federal law. Congress adopted such a provision into the Digital Millennium Copyright Act, which was signed into law by the President. It protects copyright owners by requiring that access providers take down infringements on their systems when they are informed of them and establishes the protocol to be used.

B. Religious Technology Center v. Lerma, Case No. 95-1107-A, Eastern District of Virginia.

This case was brought by RTC against Arnoldo Lerma after Lerma posted to the Internet a number of the Advanced Technology works, which were attached to a declaration that had been filed in a court file (gratuitously, and for no legitimate reason related to the case), known as the "Fishman Declaration." When Lerma refused to delete his posting or to agree not to post any further copyrighted materials, he was sued. The court granted summary judgment against Lerma, finding that Lerma did infringe upon RTC's copyrighted works and prohibiting Lerma from infringing any of the Advanced Technology works. The court's verbal ruling from the bench came in January 1996, and its decision and injunction in October 1996 and February 1997 respectively. In addition, the court awarded RTC $2,500 in damages and costs.

The court ruling included significant language recognizing RTC's rights, which we summarize briefly:

1. The Court found that there was no dispute that RTC holds the copyright interest in the works in question, and that they are copyrightable like other types of writings such as computer programs, poems, and musical scores, which much be used in a precise fashion. The judge ruled that "[d]enying copyright protection to RTC on this basis would rapidly destroy the protection and incentive for the likes of Wagner and Brahms -- an outcome that is most certainly contrary to the goals of copyright law."

2. The judge soundly rejected his argument that the "unique characteristics" of the Internet require special treatment under copyright law, finding that: "[w]hile the Internet does present a truly revolutionary advance, neither Congress nor the courts have afforded it unique status under the fair use standard of" the Copyright Act, noting that "new technologies -- from television, to video cassette recorders, to digitized transmissions -- have been made to fit within the overall scheme of copyright law and to serve the ends which copyright was intended to promote."

3. The judge rejected Lerma's contention that the fact that the documents which he posted had been in a court file destroyed their copyright protection as well as his alleged purpose "to unveil for the Internet community the `foibles' of Scientology in the same spirit of the modern news exposé," finding that "Lerma's motives . . . were not neutral and that his postings were not done primarily `for public benefit,'" judging them "in light of the degree of copying and the use to which the infringing material was ultimately put . . ."

4. The judge also rejected Lerma's argument that the works were "published," finding that "[t]he Works in question clearly have not been `published,'" since "RTC has not released these materials to the public and does not plan to release them." If one posts works without the owner's consent, it "cannot constitute a `first publication' under fair use principles" because the copyright owner has the right to decide both when and whether to publish a work.

5. Judge Brinkema also found that "[i]n the vast majority of exhibits, 100% of Lerma's document is simply a direct copy of 100% of RTC's copyrighted document." Furthermore, Lerma's argument that the postings "must be considered with in the context of the ongoing dialogue he has conducted on the newsgroup..."

"...would permit a would-be infringer to participate in blatant theft of copyright yet still escape punishment via the subsequent posting of subsequent commentary -- a commentary that may not always be seen in tandem with the infringing work. Under this argument 'cyberbandits' could easily cover their tracks."

6. The decision also rejected Lerma's defense of misuse of copyright, finding that RTC had not improperly used its copyrights and that "Lerma's infringement is unmistakable, and RTC's opposition is sound." The court then issued a permanent injunction.

C. Religious Technology Center v. FACTNet.

In 1995, RTC filed suit against FACTNet, Larry Wollersheim and Bob Penny for their support of Arnoldo Lerma for posting RTC's unpublished works. It was then learned that they had also copied various published works, including placing 1,900 published works on CD-ROMs, and BPI joined the suit. After the judgment against Lerma was obtained, RTC voluntarily withdrew from this suit in light of the fact that the Lerma injunction extended to anyone acting in concert with Lerma. This case was later favorably settled with a permanent injunction and stipulated judgment admitting liability, issued against all defendants.

D. Church of Spiritual Technology and Religious Technology Center v. Dataweb, Stichting XS4ALL, et al., Case No. 96/160, Regional Court of the Hague.

This case was brought against multiple Dutch access providers and an infringer, after they acted in concert, along with others, to post certain of RTC's Advanced Technology, and certain published works (for which New Era Publications, Aps (NEPI) is the exclusive licensee), on web sites in Holland, and refused to remove the materials from those sites.

The trial of this case took place in March 1999. The court's ruling was issued on June 9, 1999 and found that the works were copyrighted, and that the posting of them to the web sites constituted copyright infringement. The court ordered that, upon notice that an infringement is on their system, the ISP defendants must remove the infringement or at least make it inaccessible as quickly as possible. In addition, if they do not do so, they are to be penalized Hfl 5,000 for each day on which they fail to do so.

E. Religious Technology Center v. Ward, No. CV 96-20207 RMW EAI, Northern District of California.

In this case, the defendant, Grady Ward, had posted Advanced Technology works under his own name without authorization. He was also believed to be the anonymous posted behind a series of postings through anonymous remailers under the names "SCAMIZDAT" and "Vorlon," which posted dozens of RTC's works. The first postings of the 55 unpublished copyrighted scriptural works was posted under the Vorlon pseudonym. Ward has also posted many threats and taunts against RTC, claiming it is unable to stop these anonymous postings, and has made other postings in which he solicits RTC's materials and talks about shredding the evidence of anything that is sent to him.

RTC obtained a preliminary injunction against Ward in April 1996. RTC filed for summary judgment against Ward, and the court found that the postings in question were infringing and that the defenses asserted by Ward were invalid. Ward later settled with RTC, literally within minutes of the jury verdict against infringer H. Keith Henson, discussed below.

F. Religious Technology Center v. Henson Case. No. C-95-20271 RMW EAI, Northern District of California.

H. Keith Henson was sued by RTC in the same Court as Ward, about two weeks later. Following the preliminary injunction hearing in Ward, at which Henson was present, he posted one unpublished copyrighted scriptural work to the Internet in what he called "An Open Letter to Judge Whyte." When he was sent a cease and desist letter by e-mail, he rudely responded, refusing to cease infringing. A suit was filed against him a few days later.

Henson was under preliminary injunction from the beginning of the suit. On April 15, 1997, RTC's motion for summary judgment against Henson was granted, finding him liable for copyright infringement and ruling that all of his defenses were invalid. A permanent injunction was also entered against him. The only remaining issue was the amount of statutory damages (which involves a determination of whether Henson acted willfully) and attorney fees. The case went to trial before a jury on these issues, and the jury awarded $75,000 in damages.

G. Religious Technology Center v. Zenon Panoussis, Case No. T 87-866-96, District Court of Stockholm.

This case was brought by RTC in September 1996 in Stockholm, Sweden against an individual named Zenon Panoussis, arising from his Internet posting of Advanced Technology works and placement of such works on web sites. Panoussis had steadfastly refused to remove his infringements, and each attempt to deal with him short of litigation resulted in his escalation of his infringement campaign.

The issue of preliminary relief was heard by the Stockholm District Court. The court issued an "injunction on penalty of fine against Mr. Panoussis prohibiting him from taking action constituting further infringement of RTC's copyright in the unpublished Advanced Technology works. The case went to trial in May 1998. Panoussis was found liable for copyright infringement of the works in question, for his Internet postings and also for dissemination of hard copies of the works. The plaintiffs were awarded a permanent injunction, as well as costs, damages and fees of up to $160,000.

But that is not all. Before the plaintiffs closed the door on his infringing activities, Panoussis exploited a weakness in Swedish law protecting copyrights. Any materials placed in the files of the Swedish Parliament are automatically considered to be "government" materials, and therefore are publicly available under what is called "the principle of free access to public documents."

This principle of open government files was intended to allow the public to scrutinize the actions of the government. But nobody had foreseen the consequences for private, copyrighted works. Even if a copyrighted work was unpublished, and even if its author had not consented to its dissemination, the mere act of delivering the work to the Swedish parliament made it a "public document." In this way, a law passed to protect citizens' rights could be abused to violate them.

And that is exactly what this individual did. He put stolen copies of unpublished L. Ron Hubbard works in the library of the Swedish parliament -- and announced that fact on the Internet.

First, the Church took steps to ensure the confidentiality of the materials would not be compromised during the time it took to handle the situation. Then the US Trade Representative was briefed that Sweden was not enforcing international law and was opening the door to copyright piracy. When she learned what had happened, the U.S. Trade Representative immediately perceived the danger that this "loophole" in Sweden's law represented for all intellectual property owners. She took immediate action, and placed Sweden on the international watch list for three years in a row. The U.S. made clear they were really serious. Because they also put Sweden on notice that unless dramatic action was taken, they would open an investigation into Sweden at the World Trade Organization.

As a result, the Swedish Prime Minister and his 22 ministers directed that international copyright laws must be applied to protect our materials.

In order to close that loophole permanently, the law itself would need to be changed, in effect, getting the Swedish government to modify their Constitution so that copyrighted works could not become public documents in such a cavalier manner. The Swedish Ministry of Justice was persuaded to draft new legislation.

The government's proposal had to be approved by the Council on Legislation -- a body composed of former and current Supreme Court judges which reviews new laws for constitutional fitness before they go to parliament. The Council wasted no time in recommending that the new law be adopted with all possible speed. And on February 23, 2000, the Swedish Parliament passed government bill No. 35, entitled "Copyright and the Principle of Free Access to Public Documents," by an overwhelming majority of 270 to 14, a historic change in the Swedish constitution giving full protection to the unpublished, copyrighted works of all artists, writers and other creators of intellectual properties.

Other Results in Non-Internet Copyright Litigation:

Bridge Publications Inc. v. Vien, 827 F.Supp. 629 (S.D. Cal. 1993)

In 1992, a person named Enid Vien was sued for unauthorized copying of RTC and BPI works that she was using in a squirrel group that she had established. The court found Vien liable for copyright infringement, and found her defenses invalid. It issued a permanent injunction and awarded $52,000 in damages for both copyright infringement and trade secret misappropriation. Like the cases discussed above, this case also contains good language concerning the rights of BPI and RTC.
Additional Results in Internet-Related Litigation:

There are two other pieces of litigation worth mentioning. Two European suits filed by Scientology-related entities in 1995, concerned the rights of victims of crimes to obtain the identities of criminals who hid behind anonymous Internet identities. These same anonymous identities are used by people like child pornographers sell their vile images. In both cases, the courts forced the Internet Access Provider to disclose the identities of these people. After the owner of one of these systems he had been shown that his computer system had, in fact, been used by child pornographers, one of the two Internet Service Providers shut down his anonymous service.

As an active user of the Internet, the Church of Scientology feels it has a moral obligation to do its part to ensure that the Internet is free for all people, not just a handful of abusers who would pervert one of the greatest communication media ever to be invented. Thus, the Church will remain vigilant and will continue to take action only where necessary to preserve essential rights and freedoms.