Internet Copyright Law 2006 Difference Between Winning (Baidu) And Losing (Yahoo China)?

Although both Baidu.com and Yahoo China basically provided deep links to pirated mp3's, Baidu won in court, while Yahoo China lost. What are the differences?

7 (minus EMI) IFPI members versus Baidu.com

Wang Hongjiang of Xinhua reports about a group of record companies who lost again a lawsuit against Baidu.com (a Chinese search engine and the first Chinese company that became a component of the NASDAQ-100, read here), because of alleged copyright infringements.

• In 2005 the group, represented by IFPI, consists of EMI, SONY BMG, Warner Music, Universal Music, Cinepoly, Go East and Gold Label, "accused Baidu.com of engaging in illegal downloading and playing 137 pieces of music (195 sound recordings, according to IFPI, read here IP Dragon) owned by the record companies online without their permission." The demands by the group were a public apology from Baidu, the suspension of its download service and compensation of 1.67 million yuan (226,000 U.S. dollars);
• November 2007, Beijing's First Intermediate Court ruled "that Baidu's service, which provides web links to the music, does not constitute an infringement as all the music is downloaded from web servers of third parties."
• December 30, 2007, the People's High Court of Beijing agreed with Beijing's First Intermediate Court and ruled that Baidu's service does not constitute an infringement.

Read Wang Hongjiang's article here.

If you cannot beat them join them

John Liu and Jannet Ong reported for Bloomberg News that EMI dropped the appeal and joined Baidu, read here.

7 IFPI members versus Yahoo China

• April 2006, IFPI, on behalf of the 7 members asked Yahoo China to take the necessary stepts to stop the copyright infringement. Negotiations between Yahoo China and IFPI took place, but Yahoo China, according to IFPI, walked away from those talks;
• January 2007, IFPI filed a lawsuite at the Beijing No. 2 Intermediate People's Court against Yahoo China; Eleven separate claims were brought against Yahoo China by local and international record companies, who presented evidence of widespread infringement of their copyrights. The claims filed concerned infringement of tracks by international artists such as U2 and Destiny’s Child, as well as local repertoire performed by singers such as Penny Tai and Kelly Chen;
• April 2007, Beijing No. 2 Intermediate People's Court ruled Yahoo China was found liable for facilitating copyright infringement; Yahoo China appealed to the Beijing Higher People's Court;
• December 20, 2007, the Beijing Higher People’s Court, upheld the verdict.

Mr John Kennedy, Chairman and CEO of IFPI said:

“We are disappointed that the court did not find Baidu liable, but that judgment was about Baidu’s actions in the past under an old law that is no longer in force. The judgment is irrelevant since it has effectively been superseded by the Yahoo China ruling. Baidu should now prepare to have its actions judged under the new law. We are confident a court would hold Baidu liable as it has Yahoo China." Read the IFPI press release here.

China is no Common Law country and the final court, in this case the Beijing Higher People's Court, is not bound by precedent. Music 2.0, which is "exploring chaos in digital music" doubts whether Mr Kennedy's "old law" is no longer in force. Music 2.0 quotes Chinese lawyer Yu Guo Fu who said on Sina:

“Even though the Provisions of Copyright Protection regarding Transmissions through Digital Networks (Internet Copyright Law 2006) was introduced in July 2006, it is not the underlying reason for the different results in both the Yahoo and Baidu cases. Fundamentally, the higher level Copyright Law and also the General Principles of the Civil Law were unchanged throughout both cases and that has been the basis for both rulings”. Read Music 2.0's article here.

Other factors that could explain the differences between the outcomes is whether there was sufficient evidence for direct and/or contributory infringement.