Opposition Brief — Perfect 10, Inc. v. CCBill LLC (No. 07-266)

“7 @ [ FILED

NOV 2- 2097 |

No. 07-266 Cin .o = aia Ci ERK

SUrRrWVE COURT, US.

IN THE

Supreme Court of the United States

PERFECT 10, INC., a California corporation,

Petitioner,

v.

CCBILL LLC, CWIE LLC,

Respondents.

On PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED States Court oF APPEALS

FOR THE NINTH CIRCUIT

ere a rem me

ee ma ae ee A

|

BRIEF IN OPPOSITION

JAY M. SPILLANE JOHN P FLYNN

RuTH M. Moore Counsel of Record

SPILLANE SHAEFFER ARONOFF DIOGUARDI FLYNN JoNES LLP

BanpDLow LLP 7001 N. Scottsdale Road

1880 Century Park East #2060

#1004 Scottsdale, AZ 85253

Los Angeles, CA 90067 (480) 951-8800

(310) 229-9300

Attorneys for Respondents

212099 ce

COUNSEL PRESS

(S00) 274-2321 + (800) 359-6859

i

QUESTIONS PRESENTED

Under 47 U.S.C. § 230(c)(1), no interactive computer

services provider or user may be held liable for content

provided by another. Section 230(e)(2) provides that this

immunity shall not “limit or expand any law pertaining

to intellectual property.” The Ninth Circuit court of

appeals held that Section 230(e)(2) limits the immunity

provided by Section 230(c)(1) only if a federal intellectual

property claim is asserted. Thus, the Ninth Circuit held

that Section 230(e)(2) did not apply to the state

trademark and right of publicity claims of Petitioner

Perfect 10, Inc. (“Perfect 10”), which were therefore

barred by Section 230(c)(1).

Should the Supreme Court review this decision

where there is no conflict with the decision of any other

circuit court of appeals?

Should the Supreme Court review this decision

where no important federal question requiring resolution

by this Court or conflict with decisions of this Court has

been presented?

Should the Supreme Court review this decision

where the case is ongoing, such that it could be reviewed

later if appropriate?

i

CORPORATE DISCLOSURE STATEMENT

Pursuant to Supreme Court Rule 29.6, CCBill, LLC

(“CCBill”) and CWIE, LLC (“CWIE”) disclose that they

are each owned by CWIE Holding Company, Inc., a

privately held company. No publicly held corporation

owns 10% or more of the membership interests in either

CCBill or CWIE.

iii

TABLE OF CONTENTS

Page

QUESTIONS PRESENTED ................. i

CORPORATE DISCLOSURE STATEMENT .. ii

SE eT GAPE RIBOT OE. cdncccncedbncvceses: iii

TABLE OF CITED AUTHORITIES ......... Vv

ST UNITE ca 6 civ sn occ cde bevececens 1

COUNTERSTATEMENT OF THE CASE .... 1

A. The Facts of the Case. ................. 1

B. The Proceedings Below. ................ 3

REASONS FOR DENYING THE PETITION . 6

EE, | kb cbs ee radawetencanicacdeuss 9

I. THE NINTH CIRCUIT’S DECISION

PRESENTS NO CONFLICT WITH

ANY DECISION OF ANY COURT OF

Pg gS REE reer rrr ya here 10

II. THE DECISION BELOW DOES NOT

INVOLVE AN IMPORTANT ISSUE OF

FEDERAL LAW THAT SHOULD BE

SETTLED BY THIS COURT, NOR ANY

CONFLICT WITH DECISIONS OF

WE Gn Sodas idea densdeeasisenns 14

iv

Contents

Page

A. No Important Questions of Federal

FT Pe OEE TE TIT TEE OU 14

B. No Conflict with Decisions of this Court.

Vv

TABLE OF CITED AUTHORITIES

Page

Cases

Allison v. Vintage Sports Plaques, 136 F.3d 1443

I oe re ues db adhadsuasey eu ke 13

Ben Ezra, Weinstein, & Co. v. America Online

Inc., 206 F.3d 980 (10th Cir. 2000) ........... 14

Carafano v. Metrosplash.com, Inc., 339 F3d 1119

EE in wel shu acadcweeys cheeséaes 13,14

Cardtoons, L.C. v. Major League Baseball

Players Ass’n, 95 F.3d 959 (10th Cir. 1996)... 13

ETW Corp. v. Jireh Pub., Inc., 332 F.3d 915

NS ea cadet uboabemieece 13

Green v. America Online (AOL), 318 F.3d 465

a 14

Gucci America, Inc. v. Hall & Associates, 135

F. Supp. 2d 409 (S.D.N.Y. 2001) ............. 1 38

Perfect 10 v. Google, Inc., 416 F. Supp. 2d 828

(C.D. Cal. 2006), aff’d in part, rev'd in part

sub nom. Perfect 10 v. Amazon.com, Inc.,

487 F.3d 701 (9th Cir. 2007) ................. 2

vi

Cited Authorities

Page

Perfect 10, Inc. v. CCBill LLC, 340 F. Supp. 2d

1077 (C.D. Cal. 2004), aff’d in part, rev'd in

part, 481 F.3d 751 (9th Cir.), amended, 488 F.3d

EUG GHG GE OOD ciiccvccreesvvcvvawewns passim

Perfect 10, Inc. v. Visa Int'l Serv. Ass’n, 2004 WL

3217732 (C.D. Cal. Dec. 3, 2004), aff’d, 494 F.3d

Se EE 06 6505 doors iw edcawebbaes’s 2

Potomac Electric Power Co. v. Director, Office of

Workers’ Compensation Programs, Dept. of

Labor, 449 U.S. 268 (1980) .....cccccccccccs 18

TVA v. Hill, 437 U.S. 153 (1978) ............... 18

Universal Communication Systems v. Lycos,

Inc., 478 F.3d 413 (1st Cir. 2007) ...... 7,10, 11, 14

Virginia Military Inst. v. United States, 508 U.S.

EE acu oc co Waeesdnavadedsuwenes ceed 15

Voicenet Communications, Inc. v. Corbett, 2006

WL 2506318 (E.D. Pa. Aug. 30, 2006) ........ 11-12

Zacchini v. Scripps Howard Broadcasting Co.,

SE EET tices ncasccuadvanedasnea 13, 19

Zeran v. America Online, Inc., 129 F.3d 327

(4th Cir. 1997), cert. denied, 524 U.S. 937

ROPE Sie appre eempatiny peony poms 2) 13, 14, 18

Statutes

17 U.S.C. § 512

47 U.S.C. § 230

Court Rules

9th Cir. R. 351

Sup. Ct. R. 10

Sup. Ct. R. 29.6

vii

Cited Authorities

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11

il

1

OPPOSITION TO PETITION FOR CERTIORARI

Respondents CCBill, LLC (“CCBill”) and CWIE,

LLC (“CWIE”) hereby respectfully oppose the petition

filed by Perfect 10, Inc. (“Perfect 10”) for a writ of

certiorari to review the decision in this case of the United

States Court of Appeals for the Ninth Circuit. CCBill

and CWIE also hereby oppose and respond to the briefs

of Amicus Curiae Screen Actors Guild, Inc. (“SAG”) and

CMG Worldwide, Inc. (“CMG”).

OPINIONS BELOW

The initial opinion of the court of appeals is reported

at 481 F.3d 751 (9th Cir. 2007). The amended opinion of

the court of appeals is reported at 488 F.3d 1102 (9th

Cir. 2007). The opinion of the district court is reported

at 340 F. Supp. 2d 1077 (C.D. Cal. 2004).

COUNTERSTATEMENT OF THE CASE

A. The Facts of the Case.

Petitioner Perfect 10 publishes an adult

entertainment magazine and the website perfect10.com.

Perfect 10 holds registered copyrights for images of

models appearing in its magazine and on its website, as

well as several trade or service marks. (Petitioner’s

Appendix [“App.”] 34a-35a.) Many of the models

appearing in Perfect 10’s images have signed releases

assigning their rights of publicity to Perfect 10.

(App. 3a.)

2

Perfect 10 claims that its images have been copied

and posted by websites whose proprietors are not parties

to this litigation. (App. 2a.) Rather than suing these

alleged direct infringers, Perfect 10 has sued numerous

Internet service providers whose operations are quite

distant from the alleged infringing activity. In addition

to this lawsuit, Perfect 10 has targeted and filed similar

lawsuits against a number of other payment processors,

search engines, and credit card associations, including

Visa International Service Association, MasterCard

International Inc., Google, Inc., and Amazon.com, Inc.,

for their roles in providing Internet and payment

processing services. See Perfect 10, Inc. v. Visa Intl Serv.

Ass'n, 2004 WL 3217732 (C.D. Cal. Dec. 3, 2004), aff’d,

494 F.3d 788 (9th Cir. 2007); Perfect 10 v. Google, Inc.,

416 F. Supp. 2d 828 (C.D. Cal. 2006), aff’d in part, rev’d

in part sub nom. Perfect 10 v. Amazon.com, Inc., 487

F.3d 701 (9th Cir. 2007). As here, Perfect 10 has theorized

that liability should be imposed on these defendant

service providers because their services allow

webmasters with infringing content to flourish. The

courts in these cases have largely rejected Perfect 10’s

theories.

Respondent CCBill provides “a fully automated

Internet service that enables customers to use credit

cards or checks to pay for subscriptions or memberships

to e-commerce venues created and offered by CCBill’s

clients.” (App. 4a, 39a-40a.) CCBill does not produce,

design, supervise or edit the content of its clients’

websites. (App. 39a.) As Perfect 10 has consistently

acknowledged, CCBill does not itself transmit any

infringing material. (App. 20a, 82a.)

3

Respondent CWIE is a provider of Internet access,

website hosting, and other Internet-related services.

(App. 3a-4a, 37a-38a.) CWIE provides its clients, and

their customers and users, “the means to acquire and

disseminate public, private, commercial, and non-

commercial information,” by supplying what the Internet

industry refers to as “ping, power, and pipe”—ensuring

that the server is on and connecting the client’s server

or website to the Internet backbone via a data center

connection. (Jd.) CWIE does not produce, design,

supervise or edit the content of its clients’ websites.

(App. 38a.)

Contrary to Perfect 10’s unwarranted assertions,

both the district court and the court of appeals found,

save for narrow factual issues to be determined upon

remand, that Respondents had no actual or constructive

knowledge of infringement, and that their services were

not a draw for infringing activity. (App. 9a-18a, 23a-25a,

76a-80a, 83a-88a.)

B. The Proceedings Below.

Perfect 10 sued CCBill, CWIE, and others in district

court for copyright infringement, trademark

infringement, and state law claims, including rights of

publicity and unfair competition. Perfect 10 claimed that

CCBill, CWIE, and others were secondarily liable for

the actions of direct infringers.

The district court bifurcated this action into two

phases, the first relating solely to defenses under the

Communications Decency Act (“CDA”), 47 U.S.C. § 230,

and the Digital Millennium Copyright Act (“DMCA”),

4

17 U.S.C. § 512. After the close of discovery on this first

phase, the defendants filed motions for partial summary

judgment on their CDA and DMCA defenses.

CCBill and CWIE argued that they were entitled to

summary judgment against Perfect 10’s state law claims

because, as interactive computer service users or

providers who were not the providers of tiie challenged

content, they were entitled to the immunity conferred

by 47 U.S.C. § 230(c)(1). They also argued that the safe

harbor provisions of 17 U.S.C. § 512 entitled them to

summary judgment on Perfect 10’s copyright

infringement and other copyright-based claims.

In response, Perfect 10 argued that the CDA

immunity did not apply to its state law claims because,

inter alia, they were supposedly “intellectual property”

claims and thus within an exception to this immunity.

Perfect 10 asserted various factual challenges to the

application of the DMCA’s safe harbors against its

copyright claims.

On the CDA arguments, the district court granted

summary judgment against Perfect 10’s unfair

competition and false advertising claims, which the court

found were not “intellectual property” claims. The court

denied summary judgment on Perfect 10’s right of

publicity and state trademark claims. The district court

reasoned that rights of publicity are “a form of

intellectual property.” It further reasoned that the

intellectual property exception extended to Perfect 10’s

state trademark claim because state trademark law

offers relief similar to federal trademark law. (App. 92a-

103a.)

5

On the DMCA arguments, the district court agreed

with CCBill and CWIE that they were entitled to the

DMCA’ safe harbor protections. (App. 76a-88a.)

The Ninth Circuit affirmed in part and reversed in

part. Interpreting for the first time the CDA’s exception

to immunity for claims arising under a “law pertaining

to intellectual property,” the court of appeals observed

that many types of claims

may—or may not—be characterized as

“intellectual property” claims. While the scope

of federal intellectual property law is relatively

well-established, state laws protecting

“intellectual property,” however defined, are

by no means uniform. Such laws may bear

various names, provide for varying causes of

action.and remedies, and have varying

purposes and policy goals. Because material

on a website may be viewed across the

Internet, and thus in more than one state at a

time, permitting the reach of any particular

state’s definition of intellectual property to

dictate the contours of this federal immunity

would be contrary to Congress’s expressed

goal of insulating the development of the

Internet from the various state-law regimes.

(App. 26a-27a.) Accordingly, the court of appeals held

that the term “intellectual property” referred only to

federal intellectual property and held that CCBill and

CWIE were eligible for CDA immunity from all of

Perfect 10’: state law claims. (App. 27a-28a.)

6

The court of appeals affirmed in part the partial

summary judgment on CCBill and CWIE’s DMCA

defenses and remanded certain questions for further

determination. The court of appeals agreed with the

district court that Perfect 10 had not given CCBill or

CWIE any DMCA-compliant notices regarding any

subscriber’s alleged copyright infringement. However,

the court of appeals held that the district court erred in

not considering CCBill’s and CWIE’s handling of

DMCA-compliant notices from non-parties in ruling that

they had reasonably implemented repeat infringer

policies. The Ninth Circuit also remanded the action for

further findings on whether CCBill or CWIE interfered

with standard technical measures, on the nature of

CCBill’s payments to its clients, and on the facts

concerning operation of hornybees.com. (App. 15a, 18a,

19a, 21a, 31a.)

The case is currently before the district court for

further proceedings to determine the factual issues

remanded by the court of appeals. In addition, the parties

will litigate all facts not within the first phase of the

litigation, namely, those beyond the DMCA and CDA

defenses.

REASONS FOR DENYING THE PETITION

In the opinion below, the Ninth Circuit court of

appeals analyzed, for the first time in any federal

appellate court, the intellectual property exception to

the immunity created by 47 U.S.C. § 230(c)(1). The court

of appeals ruled that 47 U.S.C. § 230(e)(2), which

provides that this immunity shall not be “construed to

limit or expand any law pertaining to intellectual

7

property,” should be read as referring to federal

intellectual property. This opinion is consistent with the

findings and intentions of Congress to promote the

development of Internet computer services with a clear

nationwide immunity. See 47 U.S.C. § 230(a) and (b).

Were the rule otherwise, Internet computer service

providers would be faced with uncertainty across all fifty

states as to which state claims for relief are, involve, or

are akin to “intellectual property.”

The decision was unanimous. Judges Milan Smith,

Stephen Reinhardt, and Alex Kozinski all agreed on the

scope of the intellectual property exception. There was

no dissenting or concurring opinion.

Perfect 10 attempts to manufacture a conflict

between the opinion below and the First Circuit’s opinion

in Universal Communication Systems v. Lycos, Inc.,

478 F.3d 413 (1st Cir. 2007). However, the First Circuit

did not actually analyze the scope of Section 230’s

intellectual property law exception when it affirmed:a

district court’s dismissal of a state trademark dilution

claim on First Amendment grounds. When Perfect 10

called Universal Communication to the Ninth Circuit’s

attention for rehearing en banc, the Ninth Circuit found

that Universal Communication presented no conflict

with its decision in this case. (Petition Appendix [“App.”]

27a.) The Ninth Circuit’s opinion thus presents no

“conflict with the decision of another United States court

of appeals on the same important matter” to merit review

by this Court. Sup. Ct. R. 10(a).

Nor has Perfect 10 demonstrated that the court of

appeals “has decided an important question of federal

8

law that has not been, but should be, settled by this

Court.” Sup. Ct. R. 10(c). The law concerning the scope

of the “intellectual property” exception to Section

230(c)(1) immunity is undeveloped. No court of appeals

has decided the scope of the intellectual property

exception in a manner inconsistent with the decision

below. The issue should be allowed to percolate unless

and until a significant circuit split develops.

Moreover, because this case is not over, this Court

can consider review after there is a final judgment if a

significant split in the circuit courts has then developed.

Finally, the decision of the court below to interpret

the intellectual property exception in a manner

consistent with a broad and uniform federal immunity

for interactive Internet computer operations is correct

and not one deserving of the scarce attention of this

Court.

This Court has not ruled on the scope of 47 U.S.C.

§ 230, and thus there is no conflict between the opinion

below and any decision of this Court.

Amicus Curiae Screen Actors Guild, Inc. (“SAG”)

and CMG Worldwide, Inc (“CMG”) add nothing of

substance to Perfect 10’s deficient Petition. Neither

claims any conflict between the Ninth Circuit’s decision

and the decision of afiy circuit court or of this Court.

Neither has identified an important question of federal

law that must be settled by this Court. SAG and CMG

merely complain that the Ninth Circuit’s decision

supposedly could impede their members’ and clients’

abilities to pursue state law right of publicity remedies

9

against interactive computer service providers.

However, Congress has already weighed these interests

against the risk of stifling development of the Internet

economy posed by attempts to pin liability on interactive

computer service providers for the actions of third

parties. Congress came down squarely in favor of a

robust immunity in favor of such service providers. The

arguments of SAG and CMG may be made in favor of a

new bill in Congress, but they provide no reason for a

review of the decision below under a writ of certiorari.

ARGUMENT

In Section I below, Respondents demonstrate that

the Ninth Circuit’s opinion presents no “conflict with the

decision of another United States court of appeals on

the same important matter” to merit review by this

Court. Sup. Ct. R. 10(a). ‘

In Section II below, Respondents demonstrate that

Perfect 10 has failed to show that the court of appeals

“has decided an important question of federal law that

has not been, but stiould be, settled by this Court,” or

that the decision “has decided an important federal

question in a way that conflicts with relevant decisions

of this Court.” Sup. Ct. R. 10(c).

10

I. THE NINTH CIRCUIT’S DECISION PRESENTS

NO CONFLICT WITH ANY DECISION OF ANY

COURT OF APPEALS.

The thrust of Perfect 10’s petition is that the decision

of the Ninth Circuit supposedly conflicts with a decision

of the First Circuit. Perfect 10 is wrong.

The First Circuit’s opinion in Universal

Communication Systems v. Lycos, Inc., 478 F.3d 413 (1st

Cir. 2007) does not pose an actual conflict with the Ninth

Circuit’s opinion. In Universal Communication, the

First Circuit did not analyze the meaning of “law

pertaining to intellectual property,” but simply assumed

that the state trademark dilution claim at issue came

within this exception. Jd. at 422-23 & n.7. Such an

unconsidered assumption, without analysis, does not

create a conflict worthy of review.

Moreover, the First Circuit’s assumption that

Section 230 did not apply was unnecessary to its

resolution of the case. Although the plaintiff had styled

the claim in question as one under Florida trademark

law, the court found that the claim in fact arose from

criticism of the plaintiff on a website, and affirmed

dismissal of the claim on First Amendment grounds.

Id. at 423-24. In light of the claim’s failure on

independent First Amendment grounds, the First

Circuit’s view as to the inapplicability of Section 230 is

dictum and does not raise a material conflict with the

Ninth Circuit decision.

Notably, the Ninth Circuit rejected the contention

that it created a circuit split when it issued the opinion

11

in this case. (App. 27a-28a n.5.) After the Ninth Circuit

rendered its initial opinion in this case, Perfect 10

requested rehearing en banc on the ground that

the original opinion conflicted with Universal

Communication. Perfect 10’s request prompted the

Ninth Circuit to amend its original opinion to note that

Universal Communication had not decided, but had

merely assumed, that the state law claim there fell within

the intellectual property exception. (/d.) But while the

First Circuit “was able to sidestep the question of what

counted as intellectual property,” the Ninth Circuit

concluded that it could not avoid the question. (/d.) The

Ninth Circuit thus became the first court of appeals to

offer a reasoned interpretation of Section 230’s exception

for laws “pertaining to intellectual property.”

Although Perfect 10 petitioned for rehearing

en banc, making the same arguments it makes here, no

judge deemed Perfect 10’s challenges to the opinion

sufficiently important to‘warrant even a single vote for

rehearing en banc. See Perfect 10, Inc. v. CCBill LLC,

488 F.3d 1102, 1108 (9th Cir. 2007). The Ninth Circuit’s

criteria for granting a rehearing en banc parallel

Supreme Court Rule 10. See 9th Cir. R. 351 (“When the

opinion of a panel directly conflicts with an existing

opinion by another court of appeals and substantially

affects a rule of national application in which there is an

overriding need for national uniformity, the existence of

such conflict is an appropriate ground for suggesting a

rehearing en banc”).

The two district court decisions cited by Perfect 10—

Gucci America, Inc. v. Hall & Associates, 135 F. Supp.

2d 409 (S.D.N.Y. 2001) and Voicenet Communications,

12

Inc. v. Corbett, 2006 WL 2506318 (E.D. Pa. Aug. 30,

2006)—also do not create a legal conflict warranting this

Court’s review. As district court opinions, these decisions

do not create a conflict falling within the grounds for

Supreme Court review under Supreme Court Rule 10.

Moreover, neither of these district court cases

analyzed whether the intellectual property exception

should be read as referring to federal intellectual

property claims. In Gucci America, supra, involving the

sale of jewelry on the Internet bearing the “Gucci” mark,

the plaintiff asserted federal trademark infringement

and false designation of origin claims, as well as

trademark infringement and unfair competition under

New York common law. 135 F. Supp. 2d at 411. The

district court ruled that Section 230(e)(2) barred the

defendant’s motion to apply the Section 230(c)(1)

immunity to plaintiff’s “claims,” without disclosing

whether the motion applied to all of the claims, without

analyzing whether the state trademark and unfair

competition claims were “intellectual property” claims,

and without analyzing whether Section 230(e)(2) should

be read as referring only to federal intellectual property

claims. 135 F. Supp. 2d at 41217.

Voicenet Communications, supra, concerned

whether Internet service providers could base a civil

rights action (against law enforcement officials, for

executing a search warrant) on the ISP’s deprivation of

rights under Section 230. Voicenet did not involve

intellectual property claims or raise any question of the

interpretation of Section 230(e)(2).

13

Neither SAG nor CMG has identified any conflict

between the Ninth Circuit’s decision and the decision of

another circuit court. Each amicus simply complains that

its members or clients are interested in vigorous

enforcement of right of publicity laws on the Internet,

but neither cites a circuit court decision supposedly

conflicting with the decision in this case.

SAG cites authorities supporting its argument that

state rights of publicity are a form of intellectual

property,’ but that was not the issue decided below by

the Ninth Circuit. SAG has cited no conflict between the

Ninth Circuit and any other circuit court concerning

application of Section 230(c)(1) to rights of publicity.

In fact, the Ninth Circuit has consistently applied

Section 230(c)(1) to right of publicity claims, in the

decision below and in Carafano v. Metrosplash.com, ” nC.,

339 F.3d 1119 (9th Cir. 2003).

CMG criticizes the Ninth Circuit for following Zeran

v. America Online, Inc., 129 F:3d 327, 330-31 (4th Cir.

1997), cert. denied, 524 U.S. 937 (1998), which decided

that Section 230(c)(1) provides an immunity. Not only

does Zeran have nothing to do with the scope of the

Section 230(e)(2) intellectual property exception, but

every circuit court of appeals considering the matter has

1 Zacchini v. Scripps-Howard Broadcasting Co., 433 U.S.

562 (1977), Cardtoons, L.C. v. Major League Baseball Players

Ass'n, 95 F.3d 959 (10th Cir. 1996), Allison v. Vintage Sports

Plaques, 136 F.3d 1443 (11th Cir. 1998) and ETW Corp. v. Jireh

Pub., Inc., 332 F.3d 915 (6th Cir. 2003).

14

followed Zeran in construing Section 230(c)(1) as

providing an immunity.’

Since the Ninth Circuit’s opinion presents no

“conflict with the decision of another United States court

of appeals on the same important matter,” certiorari

should be denied. Sup. Ct. R. 10(a).

II. THE DECISION BELOW DOES NOT INVOLVE

AN IMPORTANT ISSUE OF FEDERAL LAW

THAT SHOULD BE SETTLED BY THIS COURT,

NOR ANY CONFLICT WITH DECISIONS OF

THIS COURT.

Perfect 10 has demonstrated no other circumstance

compelling use of the Court’s limited resources to review

this case.

A. No Important Questions of Federal Law.

Perfect 10 has failed to show that the court of appeals

“has decided an important question of federal law that

has not been, but should be, settled by this Court.”

Sup. Ct. R. 10(c).

First, the law in this area is undeveloped. The opinion

below is the first opinion to analyze the scope of the

intellectual property exception to the immunity provided

2 See Universal Communication Systems v. Lycos, Inc., 478

F.3d 413, 418-19 (1st Cir. 2007); Green v. America Online (AOL),

318 F.3d 465, 471 (3d Cir. 2003); Carafano v. Metrosplash.com,

Inc., 339 F.3d 1119, 1122-23 (9th Cir. 2003); Ben Ezra, Weinstein,

& Co. v. America Online Inc., 206 F.3d 980, 984-85 (10th Cir.

2000).

15

by Congress in Section 230(c)(1). This area of law should

be further developed by the federal courts in other

circuits before this Court considers reviewing the issues.

Second, the decision of the court of appeals is

interlocutory, and no final judgment has been entered

in this case. The court of appeals remanded the action

to the district court for resolution of further factual

issues related to third party notifications, interference

with standard technical measures, the nature of CCBill’s

payments, and control over one particular website

(hornybees.com). (App. 15a, 18a, 19a, 21a, 31a.) Further,

the parties have yet to litigate at the district court level

the issues beyond phase one, namely, all issues and

defenses other than application of the DMCA and CDA.

Certiorari is properly denied, or deferred until final

judgment in the lower courts, when the court of appeals

has remanded a case to the district court. See Virginia

Military Inst. v. United States, 508 U.S. 946, 946 (1993).

Third, the lower courts in this case have never

considered whether Perfect 10’s causes of action would

be viable but for Section 230’s immunity. If Perfect 10’s

claims would fail on their own merits even without

Section 230, then no construction of Section 230 in this

case would “limit or expand any law pertaining to

intellectual property.” In the absence of any indication

that Perfect 10 would prevail on the merits of its claims

if Section 230 did not immunize CCBill and CWIE,

Perfect 10’s petition raises only an abstract question.

Fourth, Perfect 10’s argument for construing the

intellectual property limitation is strictly one of negation:

Perfect 10 believes that the Ninth Circuit was wrong in

16

construing “intellectual property” to mean “federal

intellectual property.” Perfect 10 has offered no

affirmative alternative construction of Section 230(e)(2)

to substitute for the Ninth Circuit’s definition. Perfect

10 just submits that its diverse state law claims for unfair

competition, false advertising, misappropriation of rights

of publicity, and unauthorized use of a mark should be

allowed to go forward. Without a viable positive

construction of “law pertaining to intellectual property,”

Perfect 10 would leave future courts and litigants without

any guidance for determining the scope of Section 230’s

protection, exposing Internet service providers to the

very uncertainty that Congress intended to eliminate by

enacting Section 230.

Fifth, Perfect 10 has never previously argued to the

district court or the circuit court of appeals that

Congress’s use of the word “Federal” in the criminal

prosecution exception of Section 230(e)(1) implies the

absence of a limitation to federal laws in Section

230(e)(2). (See Pet. 13-15.) Perfect 10 did not raise this

argument until its unsuccessful attempt to obtain a

rehearing after the Ninth Circuit had already rendered

its decision below. The Court should permit the courts

below or in other circuits to develop this point before

considering whether the issue merits review.

Neither SAG nor CMG adds arguments justifying

review of the Ninth Circuit’s ruling. Each essentially

says that its respective members and clients are

interested in pursuing right of publicity claims in relation

to activity on the Internet, and that the Ninth Circuit’s

ruling will impede their ability to pin liability on

interactive computer service providers for content

17

created and posted by third parties. However, Congress

already weighed these interests against the interests of

interactive computer service providers, and concluded

that subjecting interactive computer service providers

to unwarranted civil liability for the activities of third

parties would impede development of the Internet

economy. Congress found the development of Internet

technology and the concomitant economic benefits to be

of vital importance. See 47 U.S.C. § 230(a) & (b).

For example, Congress cited the “extraordinary

advance[s]}” in education and communication offered by

the Internet, 47 U.S.C. § 230(a)(1), and articulated

nationwide policies “to promote the continued

development of the Internet and other interactive

computer services” and “to preserve the vibrant and

competitive free market that presently exists for the

Internet and other interactive computer services,

unfettered by Federal or State regulation,” 47 U.S.C.

§ 230(b)(1) & (2). In light of these findings and policies,

Congress came down squarely in favor of granting the

immunity found in Section 230(c)(1).

The arguments of SAG and CMG would prevent

uniform national application of the CDA immunity.

Internet service providers are simultaneously

conducting business in all fifty states. In the absence of

uniform interpretation of Section 230(e)(2), interactive

computer service providers would be exposed to

different results in all fifty states concerning which state

law claims could be considered “intellectual property”

claims. In enacting the CDA, Congress was particularly

concerned that state law might impose unwarranted

liability on companies that served merely as

intermediaries for other parties’ potentially injurious

18

online material. See Zeran v. America Online, Inc., 129

F.3d 327, 330-31 (4th Cir. 1997) (discussing legislative

purposes of Section 230).

SAG and CMG plead for sympathy for individuals

whose remedies will be limited to recovery from the

actual content providers, who may be judgment-proof.

Such “sympathy is an insufficient basis for approving a

recovery that Congress has not authorized.” Potomac

Electric Power Co. v. Director, Office of Workers’

Compensation Programs, Dept. of Labor, 449 U.S. 268,

284 (1980). In interpreting a statute, members of the

judiciary must put aside their “appraisal of the wisdom

or unwisdom of a particular course consciously selected

by Congress,” for “[o]nce the meaning of an enactment

is discerned and its constitutionality determined, the

judicial process comes to an end.’” Jd. at 284 n. 27

(quoting TVA v. Hill, 437 U.S. 153, 194 (1978)). While

Amici’s pleas for sympathy may be raised in support of

a bill before Congress to revise the scope of the Section

230(c)(1) immunity, these claims provide no basis for a

review of the decision below.

B. No Conflict with Decisions of this Court.

Perfect 10 has failed to show that the Ninth Circuit

court of appeal “has decided an important federal

question in a way that conflicts with relevant decisions

of this Court.” Sup. Ct. R. 10(c).

Perfect 10’s claim that the Ninth Circuit’s decision

conflicts with decisions of this Court is wrong. (Pet. 8,

13-15.) This Court has ruled on the scope of neither the

Section 230(c)(1) immunity nor its intellectual property

19

exception. Perfect 10 is simply urging that one principle

of statutory construction enunciated by this Court

supposedly aids Perfect 10’s reading of Section 230(e)(2).

This is hardly the sort of “conflict” with a decision of

this Court justifying review on 2 writ of certiorari.

Further, the decision of the court of appeals is consistent

with other well-established principles of statutory

construction, such as giving effect to the stated findings

and goals of Congress in enacting Section 230. Congress

made plain its intent to support the developinent of

Internet computer services through a robust and clear

nationwide immunity against secondary liability claims

involving third-party information content. :

Neither SAG nor CMG identifies any decision of this

Court that supposedly conflicts with the Ninth Circuit’s

decision. SAG discusses Zacchini v. Scripps Howard

Broadcasting Co., 433 U.S. 562 (1977), which referred

to the right of publicity as a “propriety interest,”

enforcement of which would serve goals “closely

analogous to the goals of patent and copyright law.”

433 U.S. at 573. However, the Ninth Circuit did not cite

or disagree with Zacchini, nor did it determine whether

the right of publicity is “intellectual property.” The Ninth

Circuit merely interpreted Section 230(e)(2) in a fashion

resulting in uniform nationwide application of the

immunity expressed in Section 230(c)(1).

20

. CONCLUSION

For the foregoing reasons, the petition for a writ of

certiorari should be denied.

Respectfully submitted,

JAY M. SPILLANE JOHN P. FLYNN

Rutu M. Moore Counsel of Record

SPILLANE SHAEFFER DIOGUARDI FLYNN JONES LLP

ARONOFF BANDLOW LLP 7001 N. Scottsdale Road

1880 Century Park East #2060

#1004 Scottsdale, AZ 85253

Los Angeles, CA 90067 (480) 951-8800

(310) 229-9300

Attorneys for Respondents