In an effort to protect the various rights one has in their copyrighted work, the U.S. Government has devised an extremely expensive range of statutory damages under U.S. Copyright Law. This is especially true for direct intriguers, but also for those who were involved indirectly or not involved at all! For example,  the owner of a website who hires a third party to design said website and incorporates work (images, art, video, music, etc.) owned by another without approval. Or the swap meet owner that rents space to a seller who sells illegal or pirated copies of another person’s or entity’s work (images, art, video, music, etc).

The current two-part test to determine vicarious liability is 1) whether the person or entity involved had a “right and ability to supervise” the activity or operation taking place; and 2) if the person or entity involved had a “direct financial interest in the exploitation of copyrighted materials.” In the examples above, the plaintiff will argue that the owner of the website had total control and oversight of what was used on the website and, if the website went live,  a financial benefit from the traffic the copyrighted work likely brought to the website. The swap meet owner also had the right to control the types of merchandise being sold, and received direct financial benefit from the fees paid by that seller and perhaps from the people who paid to get into the swap meet and/or purchased parking, food and drink.

Vicarious liability also extends to venues where copyrighted music is played or performed without the requisite license, or an employee illegally downloads protected work. While the first part of the test is somewhat difficult to clearly define because the factual paradigms change from case to case, the direct financial benefit test is easier to determine. With statutory damages for each violation easily reaching $25,000 plus attorney fees and costs, it’s best to consult an attorney immediately to determine the potential liability and damages.