While many performing artists and record companies complain that the Digital Millennium Copyright Act (the “DMCA”) puts them to the unfair burden of sending endless takedown notices, and argue that the law should require notice and “stay down,” supporters of Internet intermediaries and websites argue that court decisions have unreasonably narrowed the DMCA safe harbor.
A recent decision by the influential Ninth Circuit Court of Appeals (which includes California) adds to the concerns of the latter group.
LiveJournal, the defendant in this case, displayed on its website 20 photographs owned by Mavrix. Mavrix responded, not by sending DMCA “takedown” notices, as you might expect, but by filing suit for copyright infringement. LiveJournal responded that it was protected by the DMCA. However, to successfully invoke the DMCA’s safe harbor LiveJournal had to satisfy all of the legal requirements of the DMCA.
A key requirement is that infringing content have been posted “at the direction of the user.” In other words, the DMCA is designed to make websites immune from copyright infringement based on postings by users; it doesn’t protect a site from content posted or uploaded by the site itself – that is, by the site’s employees.The photos at issue were submitted by users and posted at their direction and therefore, LiveJournal argued, it satisfied this DMCA requirement.
However, when it comes to the DMCA, the devil is in the details, and the outcome in any case depends on how the courts interpret those details. In the case of LiveJournal photos are submitted by users, but they are posted only after they are reviewed and approved by volunteer moderators. For this reason, Mavrix argued, the photographs were not “posted at the direction of the user,” rather they were posted by moderators who selected them from user submissions. Further, Mavrix argued that the moderators were “agents” of LiveJournal, and therefore their actions were legally attributed to LiveJournal. In other words, as “agents” of LiveJournal their actions were the same as if they were employees.
The district court rejected Mavrix’s arguments and ruled for LiveJournal, but the Ninth Circuit reversed, holding that Mavrix had a point – the moderators might very well be “agents” of LiveJournal, in which case LiveJournal would have failed thisrequirement of the DMCA and be liable for copyright infringement. In reaching this conclusion the court emphasized that the critical inquiry is not who submitted content, but who posted the content. The court rejected LiveJournal’s position that the words “at the direction of the user” include all user submissions, even when they are reviewed and selected by agents or employees of the service provider.
In the case of LiveJournal, because moderators screened and posted user submissions the issue is whether the moderators are “agents” of LiveJournal whoseactions should be attributed to LiveJournal. In effect, the court equated agents with employees.
To make matters worse for websites hoping to use volunteer moderators, the legal “test” to determine whether moderators are agents gets into the arcane subject of agency law, a topic that rightly triggers the limbic system of any lawyer who suffered through agency law in law school. In this case the question is whether the level of control LiveJournal exercised over its volunteer moderators created an agency relationship based on “actual” or “apparent” authority. Trust me when I say that these are complex issues that no website owner would want to have to parse out while running its business, much less have to present and argue to a jury.
This ruling was a blow to LiveJournal, but the Ninth Circuit had more bad news to deliver. Even if LiveJournal was able to establish that the moderators were not agents of LiveJournal, Mavrix might be able to show that LiveJournal had “actual” or “red flag” knowledge that the postings were infringements. While the Ninth Circuit stated that “red flag” knowledge requires that the infringement be “immediately apparent to a non-expert,” the court ruled that the fact that some of the photos contained watermarks could have created red flag knowledge. Whether they did will be up to a jury to decide. If a jury decides that LiveJournal had the requisite knowledge with respect to one or more photos, LiveJournal will lose DMCA protection for those photos.
However, after this ruling the Ninth Circuit was still not done with LiveJournal.The DMCA requires that LiveJournal not have received a financial benefit from infringements that it had the right and ability to control. The court held that this benefit “need not be a substantial or a large proportion” of the website’s revenue, and added to the confusion around DMCA law by suggesting that such a benefit could be established based on the volume of infringing material on the site, even if this material did not belong to Mavrix and was not the subject of the current litigation.
What lessons can website operators draw from this case?
First, this is a very bad decision for any social media website that would like to moderate content, whether through the use of volunteers or by employees.
Any business based on LiveJournal’s business model – volunteer moderators who review user submissions and decide whether or not to post them – is at serious risk of losing DMCA protection. The degree of planning, administration and ongoing legal supervision necessary to be confident that moderators are not agents would be daunting.
It’s worth noting that this decision will be difficult to evade – the fact that a site may not be in one of the states included in the Ninth Circuit is not likely to provide protection. A site incorporated and operating outside the Ninth Circuit can be sued in the Ninth Circuit if it has minimum contacts there, and this is often easily established in the case of popular websites. The Mavrix case is so favorable for copyright owners seeking to challenge a DMCA safe harbor defense that it is likely to motivate forum shopping in the Ninth Circuit.
Second, theirony of this case is obvious – Mavrix creates an incentive to engage in no moderation or curation and post “all comers.” If there is no moderator (whether an agent or employee) to view a warning watermark, there can be no knowledge of infringement. Unregulated postings of user generated content is likely to result in more copyright infringement, not less.
Third, to add to the confusion over how the DMCA should be applied to websites that host user-generated content screened by moderators, the Court of Appeals for the Tenth Circuit issued a decision in 2016 that appears to come to the opposite conclusion regarding the use of moderators. BWP Media USA Inc. v. Clarity Digital Group., LLC. This case may give LiveJournal a chance to persuade the Supreme Court to accept an appeal of the Mavrix case (based on a “circuit split”) – assuming, that is, that LiveJournal has the stomach, and the budget, to prolong this case further, rather than settle.
Lastly, it’s important to view this decision in the context of the DMCA as a whole. Any service provider hosting user-generated content has to pass through a punishing legal gauntlet before reaching the DMCA’s safe harbor:
(i) content must be stored at the direction of a user;
(ii) the provider must implement a policy to terminate repeat infringers, communicate it to users and reasonably enforce it;
(iii) the provider must designate an agent to be notified of take down notices, register the agent online by the end of 2017 and post the contact info for the agent online on the site;
(iv) the provider must respond expeditiously to take down notices;
(v) the provider may not have actual or red flag knowledge of infringement, nor may it be willfully blind to infringements;
(vi) the provider may not have the right and ability to control infringing content; and
(vii) the provider may not have a direct financial interest in the infringing content.
This is a challenging list of requirements and, as illustrated by the Mavrix case, each requirement is complex, subject to challenge by a copyright owner and subject varying interpretations by different courts. If the service provider fails on even one point it loses its DMCA safe harbor protection.
After the Ninth Circuit’s decision in Mavrix the chances that a service provider will be able to successfully navigate this gauntlet are significantly reduced, at least in the Ninth Circuit.
Update: The Ninth Circuit clarified its position on whether the use of moderators deprives a website of DMCA protection in Ventura Content v. Motherless (2018). In Ventura the court held that screening for illegal material is permissible, and distinguished Mavrix on the ground that in that case the moderators screened for content that would appeal to LiveJournal’s readers (“new and exciting celebrity news”). “Because the users, not Motherless, decided what to post — except for [its] exclusion of illegal material . . . — the material . . . was posted at the direction of users.”
I was surprised when I read the Ninth Circuit’s recent decision in Antonick v. Electronic Arts, Inc. (9th Cir. Nov. 22, 2016). In that case the plaintiff alleged copyright infringement against EA* based on copying of computer source code for the John Madden Football game, but failed to introduce the source code into evidence, choosing instead to rely solely on expert testimony to prove copying.
*[footnote] Technically speaking, this was a breach of contract case. However, the contract between Antonick and EA stated that Antonick would receive royalties on the sale of any “derivative work”, as that term is defined under U.S. copyright law. As a result, the parties and the courts applied copyright law to determine whether EA had breached its royalty agreement with Antonick.
This was an enormous risk, and it doomed Mr. Antonick’s case. The Ninth Circuit panel held:
Antonick’s claims rest on the contention that the source code of the Sega Madden games infringed on the source code for Apple II Madden. But, none of the source code was in evidence. The jury therefore could not compare the works to determine substantial similarity.
Expert testimony alone was not sufficient, the court ruled. However, even if expert testimony had been sufficient, Antonick’s case failed: the expert testimony presented by Antonick related to how the games appeared to users (the user interface), not the source code. Antonick’s case was based on similarities between the source code of the products, not the user interface.
Maybe there was a good reason that Antonick’s lawyers didn’t introduce the source code into evidence. Perhaps the original source code (which is decades old) was no longer available, and Antonick was trying to skirt this issue; if so this isn’t apparent from the opinion. I hope, for Antonick’s sake, that his lawyers didn’t think they could prove copying of source code by focusing on the user interface of the programs, since similarities in interfaces don’t necessarily mean the source code that generates them are the same or similar.
Trial lawyers know that one goal at trial is to introduce as much evidence into the record as possible, to avoid just this kind of outcome. As long as evidence is in the record, a party can point to it to support its case even if (as likely was the case here), the evidence is computer source code incomprehensible to the jury. A document may be incomprehensible to the jury, but as long as it is in evidence, the courts will adopt the fiction that that the jury considered it in reaching its verdict.
In this case Antonick prevailed in a jury trial, but the judge set the verdict aside post-trial, based on his failure to introduce the two works. Antonick appealed, but lost on appeal.
Antonick went the last mile to try to save his case on appeal, retaining famed copyright lawyer and treatise author David Nimmer (“Nimmer on Copyright”) to argue his case. This was unsuccessful.
Here is the video of oral argument before the 3-judge 9th Circuit panel. Nimmer’s argument begins at :20 in the video, and his rebuttal testimony begins at 1:10.
The district court’s opinion, which discusses the plaintiff’s failure to introduce the works at issue into evidence in more detail, is available here.
The U.S. Copyright Office has issued a new rule that has important implications for any website that allows “user generated content” (UGC). This includes (for example), videos (think Youtube), user reviews (think Amazon or Tripadvisor), and any site that allows user comments.
In order to avoid possible claims of copyright infringement based on UGC, website owners rely on the Digital Millennium Copyright Act (the “DMCA”). However, the DMCA imposes strict requirements on website owners, and failure to comply with even one of these requirements will result in the loss of protection.
One requirement is that the website register an agent with the Copyright Office. The contact information contained in the registration allows copyright owners to request a “take down” of the copyright owner’s content.
The Copyright Office is revamping its agent registration system, and as part of this process it is requiring website owners to re-register their DMCA agents by the end of 2017, and re-register every three years thereafter. Gesmer Updegrove LLP’s Client Advisory on this new rule is embedded in this post, below. You can also click here to go directly to the pdf file on the firm’s website.
In August, MediaPost reported that Redigi and one of its founders, John Ossenmacher, had filed bankruptcy:
“ReDigi recently stipulated to pay Capitol $3.5 million in damages, but also appealed the underlying copyright infringement finding to the 2nd Circuit Court of Appeals. This week, the company said in an appellate filing that it had declared bankruptcy in U.S. District Court for the Southern District of Florida. ReDigi co-founder John Ossenmacher also declared bankruptcy in the same court.” (link)
I’ve written about this case several times, and in April 2013 I observed:
In addition, Capitol may seek leave of court to add as defendants the individual owners and employees of Redigi that exercised control over or benefited from the infringement. While Redigi could oppose such as motion as coming too late in the case, a decision would be at the discretion of the judge. As Capitol Records showed in its copyright suit against MP3tunes and Michael Robertson, Capitol is not above suing not only corporate infringers but their founders and owners. (See: The Record Labels Want My Minivan).* The philosophy of the record companies in many copyright cases may best be described as, “never kick a man when he’s down, unless that’s the only way to keep him there.” Capitol may be preparing to put on its steel toe boots in this case. (link)
In fact, this is what transpired. In September 2013 Capital Records amended its complaint to include Redigi founders John Ossenmacher and Larry Rudolph as defendants.
I also noted that –
According to the court decision Redigi consulted legal counsel before launching Redigi and engaging the recording industry in a test case.
A test case can be a great idea, but I can’t help but wonder whether the lawyers Redigi consulted warned Messrs. Ossenmacher and Rudolph that they risked personal liability. Business people are told that a corporation or LLC protects them from personal liability, but there are many exceptions to this rule, and one of these is copyright infringement. To quote a New York federal court on this issue:
It is well established that all persons and corporations who participate in, exercise control over or benefit from an infringement are jointly and severally liable as copyright infringers. . . . An individual, including a corporate officer, 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 infringement.
Sadly, I have met many lawyers, including “IP lawyers,” who were unaware of this fact. I hope Mr. Ossenmacher’s lawyers were not in this group, and that he knew the personal risk he undertook when founding Redigi.
The press calls Melania Trump’s use of Michelle Obama’s 2008 nomination speech “plagiarism,” but is it also copyright infringement? Could the authors or assignees of Michelle’s speech sue Melania and others for copyright infringement?
It’s hard to imagine this would ever happen for political and practical reasons (one of which I discuss below). But it’s interesting (fun?) to think about whether a copyright infringement suit against Melania would have legs. In that spirit, consider the following.
Ownership. It’s likely that Michelle’s 2008 speech was written by several people, each of whom could be considered a co-author. The Forward reports that the speech was first written by Sarah Hurwitz, but it’s not clear if she was an independent contractor, an employee of the Obama campaign or working for someone else. This could raise ownership issues under the work-for-hire provision of the copyright statute.
Setting aside work-for-hire, if several people participated in writing the speech (Hurwitz, Michelle, Barack?), assuming that each of these people meets the stringent requirements for co-authorship under U.S copyright law (independently copyrightable contribution and intent) and hasn’t assigned ownership to someone else, each co-author has independent standing to sue Melania for copyright infringement.
It’s not inconceivable that Sarah Hurwitz (or her then-employer) is the sole owner of the copyright in Michelle’s 2008 speech, and Michelle, Barack and the Obama campaign would have no control over a copyright infringement suit.
The bottom line is that ownership of Michelle’s speech is a complicated issue.
Fixed in Tangible Form. Michelle’s speech was recorded in video and audio, satisfying the fixation requirement.
Originality. The originality threshold for copyright protection is very low, and Michelle’s speech easily meets the minimum level of creativity to satisfy it.
Substantial Similarity. Melania might argue that the sentences she copied from Michelle were a small part of Michelle’s speech, as well as a small part of her speech, and that this de minimis level of copying does not rise to the level of copyright infringement. However, a copier cannot escape infringement based on how little of a work she copied. Even a quantitatively small amount of copying can be infringement if it copies a qualitatively important part of the original work. Michelle’s case would also rest on the tongue-twisting copyright doctrine of fragmented literal similarity, since Melania did not engage in wholesale copying, but copied fragments of Michelle’s speech. Although it may be borderline, Michelle’s claim of substantial similarity appears viable and would likely be decided by a jury after trial (rather than be resolved by a judge on a motion to dismiss or summary judgment).
Fair Use. In addition to arguing no infringement based on lack of substantial similarity and de minimis copying Melania could claim fair use – a defense asserted in virtually every contemporary copyright case. She would argue fair use based on her use of fragments of Michelle’s speech in a political, non-profit context. And, like every copyright defendant today, she would argue that her use was “transformative,” although it’s difficult to see a transformative use in this case. Nevertheless, a fair use defense has the potential to be effective, and could result in a finding of no infringement.
Scènes à faire. Melania could argue that the common phrases copied from Michelle are indispensable, or standard, in a political speech of this type, and therefore unprotected under the copyright law doctrine known as scènes à faire. Again, this defense could be effective.
No Intent. Copyright infringement is a “strict liability” violation – neither knowledge nor intent is necessary, and the absence of both is not a defense.
Idea-Expression, Merger. There are a few other “tag-along” defenses that are raised in almost every copyright case, and which Melania could assert. For example, she could argue that the sentences copied were unprotected “ideas,” or that there are so few ways to express the ideas that Michelle’s expression is unprotectable under the “merger doctrine.” However, these defenses appear weak given the material copied.
Defendants Other Than Melania. The speech was broadcast by television stations, web sites, newspapers and magazines. All of these publishers are potential defendants, but most of them would have a strong fair use defense, since they used the speech in connection with news reporting.
However, Melania’s co-authors (Merideth McIver, for example), are also potential defendants, and they stand in a position similar to Melania, whose fair use defense is weaker than that of news organizations. Note that Melania need not have participated in writing the speech to be liable, since she infringed by reading the speech in public.
Registration and Damages. It’s unlikely that Michelle’s speech was registered before Melania copied it – a quick search of Copyright Office registration records shows that both Barack and Michelle Obama have registered books, but Michelle’s 2008 speech does not appear in the registration records. Michelle would need to register the speech as a condition to bringing suit, which is easily done. However, failure to register before the infringement occurred would prevent her from recovering statutory damages (which might have been up to $150,000) or attorney’s fees (take a wild guess, now triple it). Without pre-infringement registration Michelle would be limited to recovering “actual” damages (her lost profits or a reasonable license fee), or Melania’s illegal profits attributable to the infringement, and each of these could prove difficult to establish. Of course, Michelle could also seek an injunction, but the absence of any financial incentive is likely to discourage Michelle (or her co-authors) from bringing suit. But, the statute of limitations for a copyright infringement suit is three years, so they have plenty of time to think about it.
Conclusion. A copyright infringement suit against Melania faces significant obstacles based on ownership, fair use and proof of damages, and I don’t expect that we will ever see this case brought. But, it’s fun for a copyright lawyer to think about.
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