Asher Worldwide Enterprises, LLC v. Housewaresonly.com,
The U.S. District Court for the Northern District of Illinois
held that the individual operators of a defendant website may be
held personally liable for copyright infringement for activities
occurring on the website. The court found that because the
individual defendants comprised the entity's entire workforce,
it was reasonable to infer that the defendants committed copyright
infringement. Asher Worldwide Enterprises, LLC v.
Housewaresonly.com, Inc., Case No. 1:12-00658 (N.D. Ill..,
Aug. 26, 2013) (Durkin, J.).
Plaintiff Asher Worldwide sells discounted commercial kitchen
equipment through its website www.reliabuy.com. Each product sold
on the website has a description of the product attached to it,
created by either an employee of Asher or a third party. The
copyrights of the descriptions accompanying the products are owned
Defendant, Housewaresonly.com, comprised of Stuart N. Rubin and
Marcia Rubin (the Rubins), sells discounted kitchen equipment to
restaurants through its websites housewaresonly.com and
restaurantkitchenwarehouse.com. Housewaresonly directly competes
with Asher. In 2009 and 2010, almost 100 of the copyrighted
descriptions owned by Asher and posted on Asher's website
appeared on Housewaresonly's website. After Asher's website
was redesigned in 2010 to provide potential buyers with more
information about discounted commercial kitchen equipment,
Housewaresonly launched its second website
restaurantkitchenwarehouse.com. Asher claimed that
Housewaresonly's second website contained more than 200 of
Asher's copyrighted descriptions.
Asher sued Housewaresonly for copyright infringement of its
copyrighted product descriptions. However, soon after Asher filed
the lawsuit, the Rubins dissolved the company, removed its assets
and moved to an unknown location. The service of process on the
company was delayed because it was discovered that the address
listed as their corporate headquarters was a UPS Delivery store.
Asher later amended its complaint to include the Rubins as
defendants in the case, arguing that the Rubins acted willfully and
personally participated in the alleged infringing activities.
Housewaresonly filed a motion to dismiss, arguing that they cannot
be personally liable for infringement committed by the
Housewaresonly.com entity and that Asher had not made a
"special showing" of willful personal participation in
the infringing activities.
As the district court explained, according to the Seventh
Circuit precedent, a corporate officer can be held liable if he
acted willfully and knowingly and personally participated in the
infringing activities or used the corporation to carry out their
own deliberate infringement. Here, the court said that "it is
reasonable to infer that the infringement actions of the
corporation were committed by the individual defendants because
they are in fact the corporation." The Rubins were not only
the heads of the corporation, they comprised the entire workforce.
Therefore, the court denied the Rubins' motion to dismiss,
finding it at least plausible that the individual defendants
personally participated in the alleged infringement.
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Finjan is particularly instructive in the trade secret context because information transferred electronically can still embody highly valuable info even if the information is not transcribed in a physical medium.
Current patent reform efforts in Congress center around two pieces of legislation. One, pending in the House of Representatives is sponsored by Rep. Bob Goodlatte (R-VA) (H.R. 9, known as the "Innovation Act").