This case is derived from a real judgment of the Guangzhou Internet Court. All enterprise names are anonymized to protect commercial confidentiality. The plaintiff, Bright Content Studio, is a professional short‑video content creator and copyright holder, producing original plot‑driven short‑video series for online entertainment platforms. The defendant consists of two related entities: Ocean Interactive Co., Ltd. and its wholly‑owned shell subsidiary Wave Media Limited. Ocean Interactive undertook core business decisions, while Wave Media was established for content publishing and risk isolation purposes. This dispute focuses on joint copyright infringement under the Chinese Copyright Law, identification of shell‑company joint liability, and the evidential standard for piercing corporate personality in internet content copyright disputes.
Bright Content Studio independently conceived, scripted, filmed, edited and released a batch of original plot‑based short‑video episodes. These short videos contained unique storylines, character settings, custom shooting angles and post‑production processing. The court confirmed that such short‑video clips with personalized creative expression qualify as audio‑visual works protected by Chinese copyright law. The studio completed voluntary copyright registration at the China Copyright Protection Center, and released these short‑video series on mainstream domestic video platforms, with clear copyright statements attached to each published work. Bright Content Studio had not granted any reproduction, adaptation or information‑network‑transmission licence to either Ocean Interactive or Wave Media.
Ocean Interactive intended to launch competing short‑video accounts, yet it wanted to avoid direct legal exposure. Therefore, it set up Wave Media as a separate shell‑style operating subsidiary. Although Wave Media held the formal platform account qualification, content selection, script modification, material capture and profit planning were all controlled by the parent company Ocean Interactive. Wave Media possessed almost no independent creative personnel, independent operating funds or independent decision‑making power. Its main function was to register platform accounts, upload copied content and receive platform revenue, and most operating profits were finally transferred back to Ocean Interactive through related‑party transactions.
Without obtaining authorization from Bright Content Studio, the two defendants captured original short‑video episodes, made partial clip modifications, adjusted opening sequences and individual subtitles, and then republished the derivative videos under Wave Media’s account on multiple short‑video platforms. The infringing accounts obtained substantial commercial benefits through platform traffic sharing, brand implantation and live‑streaming diversion. Bright Content Studio entrusted a notary office to complete electronic notarization of webpage content, platform data and capital flow records. After cease‑and‑desist letters obtained no valid response, Bright Content Studio filed a civil lawsuit before the Guangzhou Internet Court. The plaintiff requested the court to confirm copyright infringement, order permanent cessation of information‑network transmission of all infringing short‑video content, demand compensation for economic losses and reasonable litigation expenses including notarization fees and attorney fees, and ruled that both parent company and shell subsidiary should bear joint and several liability.
Wave Media submitted defensive arguments in court. The shell subsidiary claimed that it was the sole subject responsible for account operation and content uploading, and Ocean Interactive should not bear civil liability. It argued that the parent company only provided general business consulting services and had no direct participation in content reproduction or publication acts. In addition, the defendant contended that partial clipping and minor editing constituted new creation and should fall within reasonable‑use scope.
The Guangzhou Internet Court conducted comprehensive review of electronic evidence, capital flow records, internal business communication records and personnel affiliation materials. The court made three core factual findings. First, minor trimming of frames and subtitles cannot generate new original creation; the accused works retained the core plot, character relationships and story arrangement of the original short‑video series, which constituted substantial similarity and exceeded the statutory scope of reasonable use. Second, even though Wave Media formally executed the uploading behaviour, Ocean Interactive dominated the whole infringement plan, content selection and profit distribution. The shell subsidiary merely served as a technical tool for implementing infringing acts. Third, where a parent company uses a controlled shell subsidiary to implement copyright infringement for purpose of evading legal liability, both entities shall bear joint and several tort liability under Chinese Civil Code. Separate corporate personality cannot be abused to avoid tort compensation obligations.
The court rendered the first‑instance judgment: two defendants must stop all infringing acts, delete all copied short‑video resources, and jointly compensate the plaintiff for economic losses plus reasonable legal costs. Neither party filed an appeal, and the judgment took legal effect.
This case delivers practical guidance for domestic and overseas content operators in China. Enterprises cannot evade copyright tort liability by setting up empty shell subsidiaries to separate legal appearance from actual decision‑making. Courts will review substantive control relationships rather than merely relying on formal corporate registration information. For copyright holders, complete notarized evidence covering content release, platform publication, capital flow and related‑party transactions is critical when facing shell‑company‑related infringement. Voluntary copyright registration also creates favourable preliminary evidence during litigation.
1. https://www.chinacourt.org/article/detail/2024/10/id/8092647.shtml
