A couple of weeks ago I returned to the offices of the URBusiness Network to discuss the Digital Millennium Copyright Act (DMCA). This was my second trip to the URBusiness Network, an online radio network with a wide range of business shows.
The subject of the first show, recorded last October, was web site liability for third party postings under the Communications Decency Act (CDA). However, the CDA does not protect web sites for user postings that violate copyright law, so copyright liability and the DMCA were the topics of the current show.
Once again it was a pleasure to be interviewed by Ruck Brutti, who was joined on this occasion by co-host Nathan Roman.
[Update: Viacom v. Youtube was settled before the Second Circuit rendered its decision on the appeal discussed in this post]
After the events described in part 1, Kevin Kickstarter, founder of YouPostVid, meets with his lawyer, Mr. Jagger, to discuss whether YouPostVid needs to change its approach to managing copyrighted videos posted by users of the site. In preparation for this meeting Kevin has read the decisions in Viacom v. YouTube, and Mr. Jagger* has familiarized himself with YouPostVid’s compliance practices under the DMCA.
*[Note] Mr. Jagger’s name is a play on the infamous lawyer in Great Expectations, by Charles Dickens.
Kevin Kickstarter: Mr. Jagger, what I don’t understand is this – we comply with valid DMCA takedown notices. We take down thousands of video clips a month in response to takedown notices.
However, the DMCA also says that we can lose our immunity if we have “actual knowledge” of infringement, or if we are “aware of facts or circumstances from which infringing activity is apparent” — what you call “red flag” knowledge — or if we engage in “willful blindness,” a concept I don’t understand at all. At the same time the DMCA says that we have no obligation to monitor for infringement. How can I run a business based on this confusing set of rules?
And, as if this were not enough, I see that in the first appeal in the YouTube case the Second Circuit said that we could lose immunity if we have induced infringement. And, I read some of the briefs filed in the second appeal, and I see that Viacom is arguing that web sites don’t have to take any actions to “induce infringement” – this can be found based on the owner’s intent or state of mind. I’m totally confused. It seems that in terms of protecting YouPostVid the DMCA has more holes than swiss cheese.
Mr. Jagger: You’re right, Kevin – this is a confusing statute, and if Viacom gets its way in this appeal, the DMCA’s protection of Internet service providers will be narrowed. You need to play it safe in anticipation of an adverse ruling in this case. OK?
Kevin: Yes, I understand. But this is an intolerable situation for my company, and I hope the Second Circuit is able to clarify the law, and soon. We need to know what the rules are. I can’t believe that the online industry doesn’t have clear rules for web site liability based on user generated content 15 years after this law was passed.
Lets get going – I have a hard stop at 3:00 today.
Mr. Jagger: OK. Let me begin by reminding you that there are a lot of ways that you can lose DMCA protection that are easy to avoid. We know that your company has registered an agent to receive takedown notices, and that you have a repeat infringer policy, both of which are essential under the DMCA. You’ve also told me that you have told your employees that they may not upload videos to YouPostVid, since the DMCA only protects uploads by third parties. More than one video sharing site has been caught doing this and denied DMCA protection for employee uploads. You monitor for pornography and hate speech, but you don’t monitor for copyright infringement by means of employee monitoring or automated blocking software, and the law is clear, you have no obligation to do so, although whether you should use blocking software is something we’ll touch on at some point today.
These are all areas of the DMCA that are relatively clear. However, there are additional ways to lose the DMCA’s “safe harbor” protection that are at issue in the Viacom case and other cases pending in the federal courts in New York, and that are not so clear. I want to talk about those.
Kevin: OK, but make it quick – I don’t have much time today. I have a business to run.
Induced Infringement
Mr. Jagger: Understood. Lets start with what I think, in your company, is the easiest issue, “induced infringement.” You know that Viacom has argued, based on the Supreme Court’s 1995 Groksterdecision, that it is illegal to distribute a device (including software, and by implication a web site), “with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement.” There is no question that this is true – a service provider that “fosters” or encourages infringement risks copyright liability for acts of infringement by third parties who use its software, and cannot rely on the DMCA as a defense.
However, I think Viacom is overreaching on this issue – it argues that the service provider’s state of mind or “secret intent” is a factor in determining whether there has been inducement. In effect, it is arguing that YouTube should lose immunity under the DMCA safe harbor based on a “thought tort.” This argument seems particularly weak where, as in YouTube’s case and in your company, the service has substantial non-infringing uses.
I think that the Second Circuit will hold that an Internet service provider must engage in purposeful expression or conduct — affirmative steps — to induce infringement, and you have never done that.
But, better safe than sorry. I’m going to suggest that you hedge your bets – no emails like the ones you showed me in which you tell employees that popular, copyrighted videos are good for business. In fact, I recommend you stop emails discussing the pros and cons of various clips altogether – they have been YouTube’s worst enemy, and they can be your worst enemy.
Kevin: OK, I understand, I’ll do that. I hope you’re right. We have never encouraged or “fostered” copyright infringement in any way. Should I destroy the emails you’re referring to?
Mr. Jagger: No, I think it’s too late for that. The publisher we met with had its lawyer send me a letter demanding that we preserve internal communications, and you have to comply with that. Sorry.
Kevin: Darn ….
Actual or “Red Flag” Knowledge
The next two ways to lose protection involve what the law calls actual knowledge and “red flag” knowledge. As you noted, the law doesn’t actually use the term “red flag,” it uses the expression “facts and circumstances,” but “red flag” is a common shorthand. And, it’s difficult to separate these two concepts, so I’m going to discuss them together.
What a lot of people don’t appreciate is that since the Second Circuit’s first ruling in Viacom v. YouTubein April 2012 DMCA protection has actually narrowed. Courts in New York applying the Second Circuit decision have held that a website can lose DMCA protection if it becomes aware of a specific infringement, or if it is aware of facts that would make it “obvious to a reasonable person” that a specific clip is infringing. Rather than go into the legal theory I’m going to tell you what this means as a practical matter.
First, if you receive a valid takedown notice you must act on it. We have discussed what a valid takedown notice is in the past, so I won’t repeat that here, but you might want to review the rules on that.
Second, if you receive any information from a non-copyright owner — for example, the “good samaritans” you told me about that have sent you emails informing you that there are specific infringing works on your site — you must investigate and remove those specific clips if you find that they were copied without the permission of the owner. In other words, something less than a formal takedown notice may establish “red flag” knowledge, requiring a site owner to investigate whether the clip is copyrighted, and if so whether it has been posted with permission.
Third, and perhaps most difficult, if you or any employee becomes aware of a specific clip where it would be objectively obvious to a reasonable person that the work is copyrighted, you must investigate whether it is an authorized or an illegal copy. The courts have held that if an employee of a web site “interacts” with a copyrighted clip — views the clip, “likes” it, features it or promotes it to a different location on the site — the site must apply the “objectively obvious” test. If it doesn’t, and the owner sues for copyright infringement, the site may not be protected by the DMCA.
Kevin: Whoa, Mr. Jagger, hold on a minute, hold up, please. I don’t get it. This makes no sense.
We have no obligation to look for copyrighted clips, but if we’re told about one, or one of my employees becomes aware of one, we need to take it down? This makes no sense. I understand that we need to investigate these “good samaritan” emails identifying infringing clips, but I don’t get the second piece of this. If an employee becomes aware of a specific clip I need to decide whether it would be “objectively obvious to a reasonable person” that the clip is infringing? If that’s the case I’m going to have to tell my employees not to browse the site. Is that what the law requires? You’ve got to be kidding me!
Mr. Jagger: I agree with you, Kevin, but I do not make the laws, would that I did. I am reminded of the comment by Mr. Bumble in Oliver Twist, “If the law supposes that the law is a ass – a idiot.”
Kevin: Mr. Jagger you are always quoting Dickens, or some other long-dead writer, most of whom I have never heard of. Stop your literary peregrinations, and get to the point, please! I haven’t had a migraine in years, but I feel one coming on now ….
Mr.Jagger:Sadly, I often hear this from my clients. I am sorry.
Kevin: Proceed, sir, please. Get this over with. This is worse than a root canal procedure.
Mr. Jagger: Very well. Yes, the safest legal course of action is to tell your employees to limit their viewing of uploads to your site.
Kevin: But our employees organize clips by subject, and move popular clips to the home page and various topic pages. They have to look at the clips to do that. Are you suggesting we stop this? That we can’t even look at video uploads on our own site? That what we’ve done in the past could lead to liability?
Mr. Jagger: I am afraid so. If you don’t you will need to train your staff to recognize copyrighted works under the “objectively obvious” test, and you will need to take down clips that satisfy that test, at least until the law is further clarified.
Kevin: You want me to provide legal training to my staff? Half of these people are high school students, interns, engineers . . . They aren’t lawyers; I can’t possibly ask them to apply this test.
Besides, this is not as simple as you — or these courts — appear to assume What if the clip uses copyrighted material but it falls under fair use? What if the clip is just a bunch of kids lip dubbing a song? Is that illegal or fair use? What if its a home-made video that uses only 20 or 30 seconds of a copyrighted song – is that infringement or fair use? How about an amateur music lesson of a copyrighted song? What if its a creative videomashup? You expect me to tell my employees that they need to make these kinds of distinctions? They are not lawyers, and frankly I’m not convinced that even lawyers could sort infringing from fair use clips, given the confusing court decisions on fair use!
Mr. Jagger: You can, and you must, or you must tell them not to view clips on the site, unless you are willing to risk a lawsuit. Or, of course, you can license Audible Magic. I can give you guidelines on how to apply the “objectively obvious” test or identify fair use, and when they are in doubt you can send a link to the clips to me, and I’ll advise you.
Kevin: I bet you will ….
Mr. Jagger: So, shall we continue? I’m afraid I have more bad news …..
Kevin: Before you do that Mr. Jagger, let me just point out how ridiculous this has become. I know enough about copyright law to know that not only are network and cable shows and Justin Bieber songs and music videos copyrighted, but the fact is that almost every video clip on my site is protected by copyright law. If someone creates a cat video, or a baby video, isn’t that automatically protected by copyright law? Isn’t the Charlie Bit My Finger video copyrighted? How am I supposed to apply this “red flag” standard when almost every video on my site is copyrighted? Even Audible Magic won’t block those videos. You’re telling me that I, the founder and owner of this company, can’t look at my the video clips on the site without applying the “red flag” test to every clip I view?
Mr. Jagger: You are 100% correct, Kevin. Very likely, all of those videos are protected by copyright law. It’s difficult to reconcile the “notice and takedown” parts of the law with the “actual knowledge”/”facts or circumstances” sections. I think that this is the key issue the Second Circuit will have to deal with in the Viacom/YouTube appeal, and in an appeal in a case involving Vimeo, presenting this precise issue. In that case the court held that Vimeo had to weigh the type of music (professional v. amateur), how well-known the artist is, and other factors that could be used to distinguish amateur material from professional material. The court seems to assume that amateur material has been posted with the consent of the owner, but professional material has not. The court held that a “recognizable song,” played essentially in its entirety and in unedited form triggers the red flag, and the website owner must either take it down, or investigate to confirm it is not a copyright violation. And songs that are lip synced or mashups are no exception.
Unfortunately, the court ignores the fact that what is immediately “recognizable” to one person may not be recognizable in the least to another, so for now the best rule of thumb is, “if in doubt, take it down.” You cannot be liable for taking down a clip (the DMCA expressly states this), but you can be liable if you make the wrong decision and leave it up.
I know we are past your 3:00 stop time, but I should also mention that the Second Circuit in Viacom stated that a web site could be liable for “willful blindness” where the site owner is “aware of a high probability of the fact of infringement and consciously avoids confirming this fact.” However, it’s not clear how this is different from “red flag” knowledge, so I suggest we leave it be until the courts provide more guidance.
Kevin: Thanks Mr. Jagger, are we done.
Mr. Jagger: I do have one more issue I need to warn you about. One federal district court in New York has held, in the MP3Tunes case, that the DMCA safe harbor applies to sound recordings — in other words music — recorded before February 15, 1972. However, more recently a different court in the same district, in the Vimeo case, held that the DMCA does not apply to pre-1972 sound recordings. The judge in the Vimeo case has authorized the parties to ask the Second Circuit to decide this issue while the Vimeo case is still pending — an “interlocutory” appeal — but there’s no guarantee the Second Circuit will exercise its discretion and hear this issue at this point in the case. This is obviously a question of great importance, but at the moment the law is not clear.
Kevin: Wait a minute – if we don’t take down pre-1972 sound recordings we risk liability, but if we review our clips to try to find pre-1972 recordings, we have to evaluate every clip we review to determine if it is an infringing copy? This is a catch-22 that we just can’t win.
Mr. Jagger: I agree ….
Kevin: Mr. Jagger, let me ask you a question – what do you see as the big picture here? Where are the courts trying to guide companies like mine with this ridiculous line of cases.
Mr. Jagger: I will tell you my theory, Kevin. Under the language of the DMCA the courts cannot force web sites like yours to use filtering software like Audible Magic, or ContentID, a system developed by Google. However, they can use the law to make it so difficult to avoid liability that, as a practical matter, that will be the only option. I think that, in the not too distant future, we may see an Internet in which almost every significant site that allows a significant number of uploads will either have some form of licensing agreement with content owners, or will use filtering software to block most copyrighted works. Other than renegade sites that can’t be reached by the courts, the early days of sites like YouTube, Vimeo, Veoh and MP3Tunes will become as much a distant memory as 5 1/4 inch floppy disks.
Kevin: I need to go. I think I can sell my company for a decent profit before the forces of darkness you describe put me out of business.
[This is the first of what will be a two-part post on Viacom v. YouTube]
[Update: Viacom v. Youtube was settled before the Second Circuit rendered its decision on the appeal discussed in this post]
It seems unlikely that the drafters of the DMCA — a law enacted in 1998, the same year Google was incorporated — anticipated how difficult the courts would find application of this complex, near-5,000-word statute. There may be no better case to illustrate this than Viacom’s long-running suit against YouTube (a company owned by Google). As of November 2013 briefs had been filed in the second appeal in Viacom v. YouTube, and the case is likely to be scheduled for oral argument before the Second Circuit sometime in the first few months of 2014.*
To say that the appeal briefs are a hard slog would be an understatement. The parties and the courts have immersed themselves in legal obscurities that will be of almost no interest to most non-lawyers, and which are likely to be incomprehensible to lawyers unwilling to bury themselves in the nuances of the DMCA. (If you are tempted to bury yourself, the EFF has collected most of the briefs here).
This being the case, I concluded that it would be best to present my observations on this case in a different format than my typical blog posts. Rather than a discussion of the legal issues, I have composed a hypothetical case example (which closely follows the facts in the actual case), to be followed by a simulated discussion between the “client” and the client’s “lawyer.” This should make the issues palatable to most readers.
This post will set the stage by presenting the hypothetical fact situation, and the second post (which is forthcoming), will present the client-lawyer discussion.
Kevin Kickstarter Creates YouPostVid
(no, this was not removed – I purposefully inserted this image)
Kevin Kickstarter has started a YouTube-like company called “YouPostVid.” YouPostVid’s business is simple – it operates a “you post, we host” web site that enables users outside the company to upload video clips. YouPostVid’s sole revenue source is click-through advertising. The business is a success, and Kevin has hired several employees.
Based on good legal advice YouPostVid plays it straight, and does nothing that could be construed to invite users to upload copyrighted videos. In addition, Kevin takes the proper steps to register with the copyright office and identify an agent to receive DMCA notices of copyright violations. The company promptly deletes video clips based on notices that comply with the DMCA “notice-and-takedown” system. It also devises and enforces a reasonable “repeat infringer” policy that bars repeat infringers from uploading to the site.
Kevin is told by his lawyer, Mr. Jaggers, that he has no legal obligation to monitor the site for copyright infringements, and that in fact the less he does the better. And, unless a DMCA notice complies with the specific requirements of the law, he doesn’t need to implement a takedown.
However, YouPostVid does implement a “community flagging” program that allows users to report videos that include pornography or any form of hate speech, and these reports are checked and often deleted by YouPostVid.
YouPostVid Begins to Encounter Problems
All is well with YouPostVid, at least at the start. However, eventually a few things occur that cause Kevin concern. First, YouPostVid starts receiving emails, not from copyright holders, but from “good samaritans,” notifying Kevin that his site is rife with infringing videos. One good samaritan informs him that the site has copies of almost every Seinfeld episode, and even identifies the shows by name. (“The Soup Nazi,” “The Contest” ….). Others report other video clips which, they claim, fall under copyright protection. Several good samaritans suggests that YouPostVid expand its community flagging program to allow users to flag clips that infringe copyrights.
However, YouPostVid takes no action with respect to these communications.
Although Kevin has told his small staff of employees not to review the site for potentially infringing uploads, one employee has sent him several emails stating, in general terms, that users are uploading vast quantities of apparently copyright-infringing clips to the site, and asking whether he should take these clips down when he comes across them. In this email the employee estimates that as many as 30% of the clips on the site are copyrighted and have been uploaded illegally. Kevin responds, instructing his employees to remain “hands off” any material they suspect infringe copyrights. Kevin tells the employees that while people may be uploading infringing clips to the site, these clips are attracting viewers, and thereby supporting the site’s advertising revenues. Kevin tells them, “we have a legal obligation to respond to formal DMCA takedown notices, period. No more, no less. We have no idea who uploaded these clips – for all we know it was done by the copyright owners themselves, or with their consent. We don’t know. And, they are good for business.”
YouPostVid Is Accused by a Large, Angry Publisher
Then, a large copyright holder demands a meeting, and informs YouPostVid that it will have its lawyer present. At the meeting, Kevin is told that despite the takedown notices this publisher is sending YouPostVid, copyrighted clips are going up at a rate faster than the takedowns. The publisher tells Kevin that it is tired of playing this expensive, losing game of “whack-a-mole,” and it demands that Kevin install an automatic filtering system such as Audible Magic to identify and bar copyrighted videos. The publisher tells Kevin that YouPostVid is building its business based on rampant infringement of copyrighted works, and that by limiting its response to takedown notices it is intentionally, and improperly, turning a blind eye to massive infringement on the site.
After the Meeting …
After the meeting Kevin has a heart-to-heart with his lawyer, Mr. Jaggers, and although Kevin admits that it seems to be the case that his site has thousands of copyright-infringing videos, Kevin emphasizes that he has done nothing to encourage this. He does not want to install Audible Magic, or any other form of automatic filtering system or community flagging. He has found an inexpensive off-shore company to handle takedowns, and he wants to simply continue requiring copyright holders to provide takedown notices that comply with the DMCA, and nothing more. However, Kevin asks his lawyer to advise him on whether the copyright holders have a case against him based on any recent developments in copyright law or under the DMCA. As he puts it, “how thin is the ice on which I’m standing, Mr. Jaggers?”
Jaggers informs Kevin that a case raising the issues facing YouPostVid — Viacom v. YouTube — is pending before the Federal Court of Appeals for the Second Circuit, based in New York. Jaggers asks Kevin (who attended two years of law school before dropping out to start YouPostVid) to read the three court opinions in this case: the district court’s first decision from 2010, the opinion of the Second Circuit on the first appeal, in 2012, and the district court’s second decision in 2013 (following remand by the Second Circuit). After he does this they will meet to discuss the implications of this case for YouPostVid, and whether YouPostVid needs to take any additional steps to avoid liability for copyright-protected works posted on the site.
Whew, that is a mouthful. I was a teenage werewolf? No, I was a guest on URBusiness Network’s CHAOS Tuesday Internet Radio Show. Here’s what it means.
URBusiness Network, or “URBN,” is, in its own words, an “online radio station streaming 24/7 with business specific programing.” This is, needless to say, not your father’s radio station. In fact, it is “radio” only by analogy. Think “entirely new business technology model made possible by increases in Internet bandwidth.” In other words, this is a relatively new industry, with minimal barriers to entry (low cost, no FCC regulation) and unlimited geographic reach. URBN is a small but serious player in this market.
One of the many Internet radio shows URBN produces is “CHAOS Tuesday,” the brainchild of Jim Johnson, founder of The Standish Group. The Standish Group is an organization with expertise in large (and I mean very large) software projects. Many large software implementation projects to over cost or fail, and Standish’s mission is to figure out why and try to reduce the frequency of failure.
One of my clients retained Standish to consult in a litigation involving a large software implementation, and I made the acquaintance of Jim Johnson. Recently, he asked me if I would be a guest on The Standish Group’s weekly Internet radio show, CHAOS Tuesday, hosted by URBN. I agreed to discuss the Communications Decency Act (the “CDA”), a federal statute which relieves Internet hosts of liability for content posted by users (excluding copyright violations, which are covered by the DMCA, and violations of federal criminal law). This is a hugely important statute which, to a significant extent, defines the social media elements of the Internet. Without it you would not be able to read Amazon and Yelp reviews, and it’s questionable whether social media such as Facebook and Twitter would even exist.
In September I visited URBN’s beautiful offices in Woburn, Mass., where Jim Johnson and Rick Brutti, one of URBN’s founders (with the help of his talented and extremely friendly staff), hosted the show.
Despite the fact that one of the show’s hosts (along with Jim Johnson and me, URBN had two hosts in the studio, for a total of four people “on-air”) mangled both “Gesmer” and “Updegrove,” after a few rocky minutes at the start the show settled down and I was able to provide some commentary on the CDA — although nowhere nearly as much as I had prepared or the law deserves.
I learned two things from this experience: first, before you go into the studio make sure the host can pronounce your name; and second, you can’t anticipate every problem (yes, I already knew that).
You can listen to the show here: CHAOS Tuesday #25 (hint: click on “Listen to the Radio Show ….”).
The Digital Millennium Copyright Act (DMCA) allows a copyright holder to send a takedown notice to an online service provider that is hosting a copyright-protected work posted by a third party. But, lest the law be used to suppress lawful speech, the DMCA requires that a takedown notice contain (among other things) a “statement that the complaining party has a good faith belief that use of the material in the manner complained of is not authorized by the copyright owner, its agent, or the law,” and certify, under the penalty of perjury, that the information in the notification is accurate.
What if someone sends a takedown notice that is authorized by the law, and does so in bad faith? The law provides that –
[a]ny person who knowingly materially misrepresents under this section . . . that material or activity is infringing . . . shall be liable for any damages, including costs and attorneys’ fees, incurred by the alleged infringer . . . as the result of the service provider relying upon such misrepresentation in removing or disabling access to the material or activity claimed to be infringing . . ..
But there is a hidden nuance to the law: what if the takedown notice demands takedown of a work that the complaining party owns, but where the use that is the subject of the notice is protected by the copyright fair use doctrine? In other words, what if the takedown notice is based on a misrepresentation that a fair use is infringing? Should such a notice be viewed as a misrepresentation, and the complaining party subject to penalties?
This is the issue before Massachusetts U.S. District Court Judge Richard Stearns in Tutuer v. Crosley-Corcoran. Without getting into the sordid details of this case, it’s enough to say that the case arose out of an online conflict between two bloggers, during which Crosley-Corcoran posted a photo of herself giving Tutuer the finger.* Tutuer, in turn, posted the image on her website without Crosley-Corcoran’s permission. On thing led to another, and eventually Crosley-Corcoran sent a DMCA takedown notice to Tutuer’s ISP. Tutuer filed suit, claiming that her use of the image was fair use (and therefore was “authorized by . . . the law”). Crosley-Corcoran’s takedown notice was, she alleged, an invalid notice, and therefore an abuse of the DMCA.
*Or, as Judge Stearns put it, “a graphic gesture with her middle finger that is often associated with an unrealized ambition of French soldiers at the Battle of Agincourt.”
Crosley-Corcoran, who lives in Illinois, filed a motion to dismiss based on lack of personal jurisdiction in Massachusetts. However, in reviewing the case Judge Stearns focused on an additional issue, one that Crosley-Corcoran had not herself raised. As Judge Stearns put it:
the court seriously questions whether Tuteur has stated a viable cause of action against Crosley-Corcoran. The takedown notice at issue appears to conform to the letter of the requirements of … the DMCA. In it, Crosley-Corcoran states accurately that her likeness has been copied without her express authorization and published by Tuteur without permission …. It is true that if the tables were reversed, and this was a lawsuit brought by Crosley-Corcoran against Tuteur for copyright infringement, Tuteur would have a plausible, and even dispositive fair use affirmative defense, … . But there is no requirement in the DMCA that a notice-giver inform the service provider of an infringer’s possible affirmative defenses, only that she affirm her good faith belief (as appears to be the case here) that the copyrighted material is being used without her (or her agent’s) permission. Seen in this light, there is no material misrepresentation by Crosley-Corcoran of infringement, as a viable cause of action …
Judge Stearns issued an Order to Show Cause, giving Tuteur 21 days—until May 1, 2013—to show why the case should not be dismissed on the merits of the DMCA improper takedown notice claim (and to address, as well, Crosley-Corcoran’s claim of lack of personal jurisdiction).
Tutuer filed her response yesterday. Also, the Electronic Frontier Foundation and Digital Media Law Project filed a motion for leave to file a joint amicus brief, along with their proposed brief. (Both briefs linked below).
Clearly, Judge Stearns’ Order raises a thorny issue under the DMCA, and one that is not expressly addressed in the statute. On the one hand, given that the question whether a work is subject to fair use is highly fact-dependent and is often the subject of extensive legal debate, how is the court to deal with an alleged improper takedown based on lawful fair use? Adjudication of this issue would require a trial to determine whether the fair use doctrine applied, and whether the copyright owner that sent the takedown notice had a subjective good faith belief that the work in question was not authorized under the fair use doctrine. Given the fact that a losing wrongful takedown notice defendant is subject to attorney’s fees, the party issuing the takedown is suddenly at potentially significant financial risk. Even if the actual damages are small, the attorney’s fees could be enormous.
On the other hand, there are many examples (some of which are provided in the EFF brief), in which the DMCA takedown procedure has been abused in order to silence lawful commentary making fair use of the work that is the subject of the notice. The DMCA should not be a weapon that copyright owners can use to force the removal of fair use free speech that they dislike.
How is Judge Stearns to decide this issue? It is an issue of first impression in this circuit, so Judge Stearns has no controlling precedent to guide him. In fact, no district court in the First Circuit has addressed this issue. Tuteur and the EFF rely on 9th Circuit district court cases, which are not binding on Judge Stearns, and may not even be persuasive to him. The leading reported case, upon which Tuteur and the EFF rely, is Lenz v. Universal Music (N.D. Cal. 2008). That case holds that an allegation that a copyright owner acted in subjective bad faith by issuing a takedown notice without proper consideration of the fair use doctrine is sufficient to state a misrepresentation claim under the DMCA. However, even in that case the court noted that it had “considerable doubt” that the plaintiff would be able to prove that the defendant acted with subjective bad faith.
The answer, unfortunately, is that Judge Stearns may avoid the issue altogether by holding that personal jurisdiction over Crosley-Corcoran is lacking in Massachusetts, and therefore decline to reach the more difficult issue of whether Tuteur has a claim arising out of a wrongful takedown notice. That would be too bad, since Judge Stearns is in a position to help develop the law around takedown misrepresentations based on fair use, and possibly advance this case to the First Circuit, which would become the first federal circuit court to squarely face the issue.
I’ve posted the slides from a CLE talk I gave on Wednesday, April 25th. Hopefully, the slides are informative standing alone. They address the very recent DMCA decisions by the 9th Circuit (Veoh) and 2nd Circuit (Youtube), the copyright “first sale” doctrine as applied to digital files in the Redigi case pending in SDNY, and recent trademark “keyword advertising” cases decided in the 4th and 9th Circuits (Rosetta Stone in the 4th Circuit, Network Automation and Louis Vuitton in the 9th). There are also some slides devoted to the CFAA, including the 9th Circuit’s en banc decision in the Nosal case.
I’ll be reading this decision, issued today, more carefully in the next day or two, but my first impression is that it’s a win for supporters of the DMCA safe harbor statute based on various legal rulings, and a loss for Youtube based on the really dumb behavior of Youtube’s founders. Of course, these guys didn’t know, back in 2005, that seven years later the courts would be judging whether they were aware that they were hosting copyrighted videos. If they had known, they might not have emailed each other comments like these:
“[W]e need views, [but] I’m a little concerned with the recent [S]upreme [C]ourt ruling on copyrighted material”
“[S]ave your meal money for some lawsuits!”
“concentrate all of our efforts in building up our numbers as aggressively as we can through whatever tactics, however evil”
“our dirty little secret . . . is that we actually just want to sell out quickly”
And there’s more like that. Ouch!
In the future companies with Youtube-like businesses will, one hopes, not create evidentiary grist of this sort for content owners to use in lawsuits against them. So, this case may turn out to be a great lesson for the online industry (careful what you say), and an expensive lesson for Google, which will likely have to add some dollars to the $1.65 billion it paid for Youtube in 2006.
Cicilia Barnes’ choice in men was worthy of a Darwin Award. After she broke up with her boyfriend, he created fake personal ads for her on Yahoo and impersonated her on online forums. As the Ninth Circuit described it in Barnes v. Yahoo:
Barnes did not authorize her now former boyfriend to post the profiles, which is hardly surprising considering their content. The profiles contained nude photographs of Barnes and her boyfriend, taken without her knowledge, and some kind of open solicitation, whether express or implied is unclear, to engage in sexual intercourse. The ex-boyfriend then conducted discussions in Yahoo’s online “chat rooms,” posing as Barnes and directing male correspondents to the fraudulent profiles he had created. The profiles also included the addresses, real and electronic, and telephone number at Barnes’ place of employment. Before long, men whom Barnes did not know were peppering her office with emails, phone calls, and personal visits, all in the expectation of sex.
Barnes demanded that Yahoo take the information down, but Yahoo didn’t do so, despite a policy that it would remove fake profiles if the complaining party supported its request with a drivers license. However, attention from the press did get Yahoo to focus, at least for a short while. Again, from the court:
. . . a local news program was preparing to broadcast a report on the incident. A day before the initial air date of the broadcast, Yahoo broke its silence; its Director of Communications, a Ms. Osako, called Barnes and asked her to fax directly the previous statements she had mailed. Ms. Osako told Barnes that she would “personally walk the statements over to the division responsible for stopping unauthorized profiles and they would take care of it.”
Two months later the profiles were still on Yahoo’s site, and Ms. Barnes filed suit against Yahoo in Oregon state court. At that point, the profiles were at last removed.
To pin liability on Yahoo, Barnes need to get past 17 U.S.C. Section 230 and, like so many that came before her, she tried valiantly but unsuccessfully.
However, sometimes imaginative lawyering pays off, and Barnes argued breach of contract, based on the fact that Yahoo had engaged in discussions with her, promised to remove the material, and then failed to do so. The court:
Subsection 230(c)(1) creates a baseline rule: no liability for publishing or speaking the content of other information service providers. Insofar as Yahoo made a promise with the constructive intent that it be enforceable, it has implicitly agreed to an alteration in such baseline. Therefore, we conclude that, insofar as Barnes alleges a breach of contract claim under the theory of promissory estoppel, subsection 230(c)(1) of the Act does not preclude her cause of action.
The takeaway from this case? If you are an online service provider and someone asks you to remove objectionable material, you have two choices: you can refuse to do so and be pretty confident that Section 230 will provide you with immunity; or, if you say you will remove the material, do so, or risk facing the outcome that Yahoo experienced in this case.
We had a great CLE at the BBA on Wednesday evening. The lucky folks who attended received three hours of (almost) nonstop legal info, and we barely scratched the surface of the topics.
I spoke on CDA Section 230, which has seen a great deal of activity lately, and there are no signs it’s slowing down. Below, via scribd.com, are the slides and paper that I prepared for the program.
On January 26, 2009, in what may have been Judge Ralph Gants’ last opinion before departing Suffolk Superior Court for the Supreme Judicial Court on January 29, 2009, Judge Gants ruled on a number of issues in the New England Patriots lawsuit against StubHub.com. The claims are based on the fact that StubHub provides an online marketplace for the scalping of Patriot’s tickets, something that really pisses off the Patriots’ owners, who attempt to exercise a high degree of control over their ticket sales. The Patriots’ various causes of action arise out of their claim that the tickets are a “revocable license” with printed terms, and civil claims related to the Massachusetts anti-scalping statute, G. L. c. 140, Section 185A.
The discussion on 47 USC Section 230 is only a small part of the decision (which addresses a number of defensive theories set forth by StubHub on summary judgment, rejecting most of them) is as follows:
CDA immunity “applies only if the interactive computer service provider is not also an ‘information content provider,’ which is defined as someone who is ‘responsible, in whole or in part,’ for the creation or development of the offending content.” Roommates, 521 F.3d at 1162;47 U.S.C. § 230(f)(3). The Ninth Circuit has interpreted the term “development” as “referring not merely to augmenting the content generally, but to materially contributing to its alleged unlawfulness. In other words, a website helps to develop unlawful content, and thus falls within the exception to section 230, if it contributes materially to the alleged illegality of the conduct.” Roommates, 521 F.3d at 1167-1168. Here, as discussed earlier, there is evidence in the record that StubHub materially contributed to the illegal “ticket scalping” of its sellers. In effect, the same evidence of knowing participation in illegal “ticket scalping” that is sufficient, if proven, to establish improper means is also sufficient to place StubHub outside the immunity provided by the CDA.
The Ninth Circuit Roommates.com decision is, itself, debatable (and the dissent debates it quite credibly). In that case the 9th Circuit (en banc) held that because Roommates.com provided drop down menus that provided choices that violated the Fair Housing Act (children, sexual orientation), Roommates.com had lost immunity under Section 230. The drop down menus, the Ninth Circuit held, turned the web site into the “developer . . . at least in part” of the illegal information.
Although it’s not clear from Judge Gants’ decision, a look at the StubHub site shows that that StubHub fell directly into the Section 230 exception created by the Ninth Circuit. StubHub guides ticket sellers through a series of menu choices (sport/team/date), much in the manner that Rommates.com does. Assuming that the presence of the Patriots in this menu structure induces sellers to engage in illegal conduct by selling the tickets (Judge Gants used the Supreme Court’s copyright infringement decision in Grokster decision to argue inducement), StubHub fell directly under Roommates.com.
One must wonder whether StubHub could obtain immunity under 47 USC Section 230, going forward, by simply eliminating references to the Patriots and allowing sellers to fill in the Patriot’s name in free text. This would be analogous to the “open text box” (as opposed to the drop down menus) that the Ninth Circuit held was protected by Section 230 immunity in Roommates.com. The Patriots would have a difficult time getting past Section 230 if StubHub was purely passive. However, this would be a significant deviation from the system of identifying tickets to sell or buy created by StubHub, and I’m sure would result in fewer sales of Patriot’s tickets.
It’s easy to forget that the Digital Millennium Copyright Act is really two separate laws. One protects publishers from “inadvertent” copyright infringement by creating the “notice-and-takedown” regime that requires copyright owners to demand that publishers take down copyrighted works published by third parties before asserting infringement. The other part of the DMCA is the anti-circumvention rule that generally prevents anyone from from bypassing copy protection schemes.
The Electronic Frontier Foundation (“the leading civil liberties group defending your rights in the digital world”) has published the fifth update to its comprehensive white paper, “Unintended Consequences: Ten Years Under the DMCA.”This 19 page report details the extent to which the DMCA’s anti-circumvention provisions have been used to not to mount legal challenges against pirates who develop technologies to circumvent copy protection, but against consumers, scientists, and legitimate competitors in ways not fully anticipated when the law was passed. The EFF paper provides a comprehensive history of this side of the DMCA, including the famous “Felton/SDMI challenge” incident in 2000 (“bet you can’t defeat this protection. You did? Well, any disclosure of that would violate the DMCA, so put a sock in it”), and the efforts to claim that an end-user license agreement may constitute an access control measure protected by the DMCA. This is a “must read” document for anyone interested in anti-circumvention enforcement under the DMCA.
Articles by Joe Laferrera of my firm, discussing application of the DMCA in the cases of Lexmark International v. Static Control Components, and Chamberlain Group v. Skylink Technologies are linked here and here.
“[n]o provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider. … [n]o cause of action may be brought and no liability may be imposed under any State or local law that is inconsistent with this section. . . . . [However this law] shall [not] be construed to limit or expand any law pertaining to intellectual property.”
This site is hosted by Gesmer Updegrove LLP, a technology law firm based in Boston, Massachusetts. You can find a summary of our services here. To learn how GU can help you, contact: Lee Gesmer
Although Kevin has told his small staff of employees not to review the site for potentially infringing uploads, one employee has sent him several emails stating, in general terms, that users are uploading vast quantities of apparently copyright-infringing clips to the site, and asking whether he should take these clips down when he comes across them. In this email the employee estimates that as many as 30% of the clips on the site are copyrighted and have been uploaded illegally. Kevin responds, instructing his employees to remain “hands off” any material they suspect infringe copyrights. Kevin tells the employees that while people may be uploading infringing clips to the site, these clips are attracting viewers, and thereby supporting the site’s advertising revenues. Kevin tells them, “we have a legal obligation to respond to formal DMCA takedown notices, period. No more, no less. We have no idea who uploaded these clips – for all we know it was done by the copyright owners themselves, or with their consent. We don’t know. And, they are good for business.”
Then, a large copyright holder demands a meeting, and informs YouPostVid that it will have its lawyer present. At the meeting, Kevin is told that despite
the takedown notices this publisher is sending YouPostVid, copyrighted clips are going up at a rate faster than the takedowns. The publisher tells Kevin that it is tired of playing this expensive, losing game of “whack-a-mole,” and it demands that Kevin install an automatic filtering system such as 
After the meeting Kevin has a heart-to-heart with his lawyer, Mr. Jaggers, and although Kevin admits that it seems to be the case that his site has thousands of copyright-infringing videos, Kevin emphasizes that he has done nothing to encourage this. He does not want to install Audible Magic, or any other form of automatic filtering system or community flagging. He has found an inexpensive off-shore company to handle takedowns, and he wants to simply continue requiring copyright holders to provide takedown notices that comply with the DMCA, and nothing more. However, Kevin asks his lawyer to advise him on whether the copyright holders have a case against him based on any recent developments in copyright law or under the DMCA. As he puts it, “how thin is the ice on which I’m standing, Mr. Jaggers?”
