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GIFs uploaded from subscribers were stored in "an upload file, where an RNE employee briefly checked the new files to ascertain whether they were 'acceptable,' meaning not pornographic, and not blatantly protected by copyright." If the GIFs passed muster, they were made available to all users of defendant's service.

Subscribers, without the consent of plaintiff Playboy Enterprises, Inc.

The court further found that the individual defendant, who was the President and sole shareholder of the company which operated the BBS, was also liable for direct copyright infringement. who has the ability to supervise infringing activity and has a financial interest in that activity, or who personally participates in that activity is personally liable for the infringement." Applying this test, the court held the individual defendant personally liable for the infringement, even though there was no evidence that he personally approved the uploading onto the BBS of infringing GIFs.Rather, his position as President, coupled with the authority to control the BBS's content, was sufficient to impose liability upon him.(The court's decision is silent on the issue of the financial benefit the individual defendant derived from the infringing activities).Merely encouraging or facilitating those activities is not proscribed by the [copyright] statute.Defendants, however, were directly involved in the distribution and display of plaintiff's copyrighted works because of their policy of encouraging uploading GIFs, and their attempts at screening the same for infringing materials.

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