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Google wins part of nude-photo suit

A federal appeals court Wednesday cleared Google Inc. to resume posting tiny versions of nude photos by a Beverly Hills-based adult publisher.

The U.S. 9th Circuit Court of Appeals undid a preliminary injunction, issued last year by a Los Angeles District Court, that had kept the Web search giant from displaying thumbnail-size photographs of images owned by Perfect 10 Inc. that other sites had improperly posted.

Saying the District Court erred, the San Francisco-based appeals court ruled that Google could legally display those images under the fair use doctrine of copyright law. The doctrine allows use of copyrighted work under some conditions, such as for parody or education.

But the three-judge panel handed Google a mixed victory. It sent the case back to the District Court to determine whether Google was indirectly liable for damages because it linked to websites that displayed Perfect 10's copyrighted images without permission.

Google, based in Mountain View, Calif., is fighting legal battles on a number of fronts over how it indexes and displays copyrighted material, including photos, books and TV shows.

"We are delighted that the court affirmed long-standing principles of fair use, holding that Google's image search is highly transformative by creating new value for consumers," Google General Counsel Kent Walker said in a statement.

Amazon.com Inc. also was named a defendant by Perfect 10 because its A9 search engine points to Google's search results. The Seattle-based online retailer declined to comment on the ruling.

Dan Cooper, Perfect 10's general counsel, said the company would ultimately prove that Google was indirectly liable for copyright infringement. He cited the court's finding that, "There is no dispute that Google substantially assists websites to distribute their infringing copies to a worldwide market and assists a worldwide audience of users to access infringing materials."

Cooper said that finding "confirms what we've believed all along: that a search engine cannot knowingly facilitate access to infringing material without consequence."

Legal experts differed over what the ruling might signal for Google's legal battle with Viacom Inc. over clips of TV shows posted on Google's YouTube video service.

Evan Cox, a partner at law firm Covington & Burling in San Francisco, said the court's decision left open the possibility that courts could someday require Google and Internet service providers to actively try to stop users from using their technology to traffic copyrighted content. So far, the 9th Circuit has held that a company has to take action only if it knows of a specific instance of copyright infringement — and it can easily stop the infringement.

"This is a win for Google but with some worrisome loose ends in the opinion," Cox said.

But Neil J. Rosini, a lawyer with Franklin, Weinrib, Rudell & Vassallo in New York, said the case merely reaffirmed Google's defense in most copyright cases: that it complies with copyright law because it takes down copyrighted material when its owners ask.

The ruling came on the same day that Google announced a revamp of its popular search engine. Through an effort called Universal Search, Google began displaying full-length playable videos, images and news stories directly in its general search results. For example, a query about Steve Jobs will pull up pictures of Apple Inc.'s chief executive, as well as blogs about Jobs and a video of his 2005 speech at Stanford University.