Human Resource Selection 9th Edition by Marianne Jennings

Exercise 5

Perfect 10 is the publisher of the eponymous adult entertainment magazine and the owner of the website perfect10.com. Perfect10.com is a subscription site where consumers pay a membership fee in order to gain access to content on the website. Perfect 10 has created approximately 5,000 images of models for display in its website and magazine. Many of the models in these images have signed releases assigning their rights of publicity to Perfect 10. Perfect 10 also holds registered U.S. copyrights for these images and owns several related, registered trademark and service marks.
CWIE provides web hosting and related Internet connectivity services to the owners of various websites. For a fee, CWIE provides "ping, power, and pipe" services to their clients by ensuring the "box" or server is on, ensuring power is provided to the server, and connecting the client's service or website to the Internet via a data center connection. CCBill allows consumers to use credit cards or checks to pay for subscriptions or memberships to e-commerce venues.
Perfect 10 sent letters and e-mails to CCBill and CWIE stating that CCBill and CWIE clients were infringing Perfect 10 copyrights. CCBill and CWIE took no action against their customers following the complaint. Perfect 10 filed suit against CCBill and CWIE for vicarious copyright infringement. Could CCBill and CWIE be liable for infringement? Apply what you have learned of the principles of law in this area from the Grokster and Sony cases. ( Perfect 10, Inc. v CCBill LLC, 481 F.3d 751 [9th Cir. 2007])