The Problem of Inline Linking: Perfect 10, Sinclair Broadcasting, and an Imperfect Internet

In 2007, copyright owner Perfect 10 (a purveyor of photos of nude women) brought a lawsuit against Google and Amazon, alleging, among other things, that Google “displayed” full-size images from Perfect 10’s website (not those behind its paywall) in its search returns. The process – known as inline linking – will be familiar to anyone who uses Google. In any search return for images, click on the thumbnail that appears, and the image opens in a slightly larger size a box, together with a link to the webpage on which it appears, as well as the ability to view the full-size image in a separate tab or window.

In 2007 (after three years of litigation), the Ninth Circuit Court of Appeals held that Google's display of a copy of the full-size images was not infringing because Google's computers did not store the images. (Perfect 10 v. Google, Inc., 508 F.3d 1146). Rather, Google merely used HTML instructions, which caused the user's browser to interact with the original source, allowing the image to appear to the user. Because Google only used HTML, and did not reproduce the code of the image itself (i.e., store it on its servers), the Court found, there could be no infringement in the “display” of the image. The Court further found that Google could not be liable under the theory of “contributory” or “vicarious” infringement because there was no underlying infringement that Google was facilitating or participating in. Among other things, the Court found, based on prior decisions, that the local caching of the images by the user's computer is either de minimis (no more than is necessary to assist the user in use of the internet) or transformative (essential to the functioning of the internet) or fair use.

It was the Perfect 10 decision that resulted in the decision of the District Court for the Northern District of California, in Hunley v. Instagram (Case No. 21-cv-03778-CRB), that Instagram's "embedding" mechanism (through which third parties can copy the HTML of the Instagram user's post and paste it into the third party's website, causing the photo or video to appear) was non-infringing. When the court first issued its decision, it advised Hunley to appeal the decision to the Ninth Circuit Court of Appeals. Instead, Hunley sought to amend its complaint. On February 1, 2022, the Court declined to accept the amended complaint, finding that it failed to allege any actionable wrong. Since Hunley had no choice but to acknowledge that third parties using the embedding tool were able to display the copyrighted photos and videos without storing them on their own servers or devices, the Court said, the Perfect 10 decision was controlling. And like Perfect 10, because there was no known underlying direct infringement, Instagram could not be secondarily liable. 

Perfect 10 and the result in Hunley are inconsistent with decisions of other courts, most notably in Nicken v. Sinclair Broadcasting Group, 2021 WL 3239510 (July 30, 2021). There, the plaintiff sued Sinclair Broadcasting for inline linking of plaintiff's video of a starving polar bear, in an article entitled "Starving polar bear goes viral in heartbreaking video." Sinclair embedded the video in its article by using the Instagram API and including in its website the required HTML code. In deciding Sinclair's motion to dismiss, the District Court for the Southern District of New York rejected the Ninth Circuit rule that an infringement via "displaying" an image occurred only when a copy of the work is stored on the infringer's server. Moreover, the Southern District of New York found two facts that distinguished Sinclair from Google: Google operated a search engine, and the full-size copyrighted images were displayed only if a user clicked on a link. (The latter does not appear to be accurate.) In any case, Sinclair's motion to dismiss was denied, and the parties settled.

Ultimately, the real distinction between the two cases is not that Google was operating a search engine, but that Sinclair operates for-profit news stations and websites that stood to profit from the web traffic the polar bear video attracted. News outlets often license photos and videos to illustrate and add visual interest to their articles -- but here, the Sinclair Defendants have not paid the licensing fee.

Sinclair did not ultimately decide the issue whether Sinclair's article embedding the video made the embedding "transformative," that is, altering the purpose and context of the work with new expression, meaning, or message. The Court considered that it might be transformative, but displaying an entire work for a story about the work's popularity seems to be too easy an out from a claim of copyright infringement, that is, it really doesn't create new meaning. It only provides an excuse to show the image without licensing it.