As digitalization and networking has progressed, copyrighted works etc. have become easily available for a wide range of users, a variety of purposes and also in a wide variety of forms. The foregoing fact (i) has created opportunities to develop and globally expand new technologies and businesses relating to the use of copyrighted works etc. and also (ii) has generated a global flood of counterfeit goods and pirated copies, especially on the Internet.

In these circumstances, with respect to the liability of service providers involved in the use of copyrighted works etc. especially on the Internet, the courts have considered whether to adopt the following legal theories in relevant cases as a theory of interpretation of the Copyright Act which has no provision for indirect infringement of copyrights etc.: the karaoke doctrine (a decision rendered by the Tokyo High Court on March 31, 2005 [the File Rogue case], an order made by the Intellectual Property High Court on November 15, 2005 [the Rokuga Net provisional injunction case], an order made by the Intellectual Property High Court on December 22, 2006 [the Maneki TV provisional injunction case], an order made by the Tokyo District Court on March 30, 2007 [the Rokuraku II provisional injunction case], a decision rendered by the Tokyo District Court on March 25, 2007 [the MYUTA case], a decision rendered by the Osaka High Court on June 14, 2007 [the Yoridori Midori case], a decision rendered by the Intellectual Property High Court on September 8, 2010 [the Just Online case] etc.); the doctrine of indirect infringement (a decision rendered by the Osaka District Court on October 24, 2005 (which was, however, changed by the decision rendered by the Osaka High Court on June 14, 2007) [the Yoridori Midori case]; and the omission doctrine (a decision rendered by the Tokyo High Court on March 3, 2005 [the 2channel Shogakukan case]) etc.

In this connection, in the Maneki TV case (the principal action) - a case relating to a service of transmitting TV programs through the Internet to a user upon his/her request - on January 18, 2011, the Supreme Court reversed the decision of the lower court which found no infringement based on the right of making broadcasts transmittable or the right of public transmission. The Supreme Court held that if a device which, when connected to a telecommunications line provided for use by the public, functions to perform automatic transmission of information inputted into such a device in response to a request from a receiving person, is connected to such a telecommunications line and information is continuously inputted into the device, a person who inputs information into the device should be considered to be performing the act of transmitting such information.

Further, in the Rokuraku II case (the principal action) - a case relating to a service of recording TV programs and transmitting the same through the Internet to a user upon his/her request - on January 20, 2011, the Supreme Court reversed the decision of the lower court which found no infringement based on the right of reproduction. The Supreme Court held that if a provider of service enabling a user to reproduce broadcast programs inputs TV programs received by an antenna into a device having a duplicate function under the control of the service provider and such TV programs are automatically duplicated when such a device receives a command to reproduce the programs, the service provider should be considered to be performing the act of duplicating the TV programs.

The question is whether these Supreme Court decisions will be specifically applied, depending on the case and/or the matters to be judged, to a service of (recording and) transmitting broadcast programs through the Internet in response to users' requests and/or the case where a service provider acquires contents and inputs the same to a duplication device or an automatic public transmission device under its control. In this regard, there is fear that the present development and global expansion of new technologies and businesses including services for content storage and content platform, etc. on the Internet may wither because of said Supreme Court decisions. Further, it will be worth noting how these Supreme Court decisions impact the movement for revising the Copyright Act so as to legislate against indirect infringement of copyrights etc., which movement is expected to begin in earnest in the year 2011.