Chinese video-sharing site QVOD argued against a 260-million-yuan ($41.8 million) administrative punishment by the Shenzhen Market Supervision Administration in an appeal to the Guangdong Higher People's Court on Tuesday.
Shenzhen QVOD Technology, founded in 2007 in Guangdong province, accused the supervision administration of not having the right to hand down administrative punishments, violating administrative procedure law, basing a ruling on inadequate evidence and levying an inappropriate level of fine.
The legal representative of Tencent Holdings also participated, as the company was involved in the original trial.
Tencent in March 2014 complained to the supervision administration that QVOD was violating its copyright through online video sharing, and was not paying for content.
QVOD argued that it was only a search engine and didn't directly provide content, but Tencent said that QVOD provides long-term technical and financial support to the small websites that it links to, and it has established an industrial chain.
The supervision administration ordered QVOD to pay a hefty fine of 260 million yuan for copyright infringement, three times what QVOD made by such activities.
QVOD claimed that the ruling was a duplicate punishment - after the National Copyright Administration in December 2013 ordered immediate rectification - because the data source was the same in PC and mobile networks.
QVOD also argued that it didn't violate public interest, and therefore the case should have been regarded as only a civil infringement.
The site has since been shut down.
The supervision administration stated that it also received complaints from other companies, including LeTV and Sohu, and QVOD's business model violated the law, which it continued to do after the National Copyright Administration's order.
A final decision has yet to be announced.