Friday, January 16, 2026
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Corporate liability for IP infringement : Direct v. Vicarious liability

Abstract

Corporate infringement is the act of a company using , reproducing , or distributing copyrighted content without authorization.Corporate liability for IP infringement occurs when a business , whether intentionally, or unintentionally violates IP laws.

This article covers corporate IP infringement and it’s liability i.e direct or vicarious liability.

Introduction

Intellectual property law is characterized by the protection of creators right and guarantee of fair use of original work. Corporation are frequently emerged in copyright disputes due to their growing dependence on digital content , software and online platforms .

Dependency on the company’s involvement in the infringement , this liability may be direct , vicarious , or contributory. Corporate liability is addressed through legal frameworks such as u.s.copyright Act , 1976 and Indian copyright Act , 1957 .I

Corporate liability can be categorised as follows :

  • Direct liability : The act of a company itself copying or distributing copyrighted material without permission. A corporation’s intentional or unintentional copying , distribution , or public display of a copyrighted work without authorization constitutes copyright infringement.
  • Vicarious liability : It means that  a corporation is held accountable for the action of it’s employees or third parties under it’s control. It takes place when a person or entity gets benefitted because of the IP infringement done by the Primary infringer. Companies held liable for any fault done by his employee’s.
  • Contributory Negligence : When a corporation intentionally or negligence facilitates or encourages copyright infringement. The act of a company using , reproducing , or distributing copyrighted content without authorization it’s lead to corporate infringement.

Legal framework for corporate liability

  1. Berne convention (1886) : It establishes international standards for copyright protection.
  2. TRIPS Agreement ( 1994) : It requires WTO ( world trade organisations) members to enforce copyright rigorously.
  3. The United States of copyright Act ( 1976) : It establishes corporate liability , which includes safe harbor provisions associated with the Digital Millenium copyright Act.
  4. The copyright Act of 1957 in India imposes penalties for corporate copyright infringement.
  5. EU Copyright Directive : It establishes more stringent regulations for the enforcement of copyrights on digital platforms.

The Impact of technology on corporate infringement

The enforcement of copyright has become increasingly difficult as a result of the proliferation of digital platforms , cloud computing and AI.

AI generated content : The legal frameworks surrounding AI generated materials which raises concerns about liability and ownership. It is imperative that company resolve their issues.

Piracy on digital platforms : The harbouring on copyrighted content by streaming sites and social media platforms is subject to increasing scrutiny.

Copyright compliance policy: Incorporating copyright checks into business operations and providing employees with education.

Guaranteeing proper licensing : It is imperative that companies obtain explicit licenses for any copyrighted content they utilize.

Corporation can prevent legal disputes  , safeguard intellectual property  and uphold ethical business practice in the digital realm.

Corporate responsibility for corporate infringement

In the digital age , corporation have become a significant legal concerns due to their copyright infringement . Corporate liability for infringement occurs when a business directly violates copyright laws or indirectly facilitates infringement through it’s employees or third – party users .

The interpretation of corporate copyright liability by courts is underscored by cases including  :

  • Disney v. Vid Angel
  • Google v. Oracle

To prevent legal penalties and promote ethical and legal – business practices , corporation must carefully navigate the changing copyright law as digital content expands.

The most important legal principles

1.Corporate personhood principles : In legal terms , corporation are considered distinct legal entities and may be sued for copyright infringement.

It is imperative for business to comprehend corporate liability in copyright infringement in order to prevent legal repercussions.

2.Employer liability : The corporation may be held accountable for copyright infringement committed by an employee while on the job.

Licensing agreements , training program’s and risk assessment strategy are all necessary for companies to guarantee compliance with copyright laws.

3.Intent and Negligence  : when determining liability , court’s evaluate whether the infringement was intentional , negligent or accidental.

In order to prevent infringement claims , corporation must adhere to both domestic copyright laws and international treaties.

Case studies

  • Disney v. Vid Angel (2016):  Disney and other studio sued vidangel , a streaming service for unlawfully movies by removing objectional content. The court determined that Vid angel had violated copyright laws  , resulting in a $ 62 million penalty.
  • Oracle v. Google (2010-2021) : Oracle filed a lawsuit against Google for the unauthorised use of java APIs in android. Copyrighting software code is a complex process  , as the case demonstrated.

Corporate legal defences :

Fair used defence : The use may be permissible if it is transformative .

Example :- parody , criticism and education.

Licensing Agreements : In the event that the corporation possesess a legal legitimate license , there is no infringement.

De Minimis use : Infringement may not be deemed to occur if the copyrighted material is used in a trivial or insignificant manner.

Corporation may incurr substantial financial penalties and reputational harm as a consequence of their direct copyright infringement. Strict compliance program must be implemented by companies to guarantee that all copyrighted material are either properly licensed or fall under fair use provisions.

Examples of direct copyright infringement

  • Employees copyrighted images in advertisements without authorization.
  • Software piracy , which involves the use of unlicensed software by enterprises.
  • The unauthorised use of streaming of copyrighted content  , such as streaming of copyrighted film without licence.
  • The unauthorised reproduction and sale of copyrighted materials including literature , music and designs.

Conclusion

The issue of corporate liability is intricate and constantly changing , influenced by technological advancements  , legal frameworks , and corporate ethics.

Furthermore the determination of corporate responsibility is significantly influenced by safe harbor provisions and fair use and fair dealing. In order to avoid legal disputes , companies must implement proactive measures.

Copyright disputes are anticipated to increase as business become more dependent on cloud based services , artificial intelligence and digital content. In order to avoid legal repercussions and uphold ethical business practices in the digital age  , companies must implement proactive measures.

References :

  • Copyright Act of ( 1957)
  • Intellectual property Rights
  • Indian kanoon
  • Online websites
  • Manapatra

Also Read:
Rights of undertrial prisoners in India
How To Send A Legal Notice In India

 

 

 


 

 

Shilpi Shandilya
Shilpi Shandilya
I'm a final year law student of 3 years law program. I'm interested in corporate lawyer specialization in IPR, contract drafting.
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