Court Dismisses Viacom's $1 Billion Copyright Claims Against YouTube
July, 2010
By
Gail R. Manuguid,
Janet Kim Lin,
Stephen D. Fisher
Court reaffirms that copyright owners bear the burden of protecting their material under the DMCA "Safe Harbor" Act.
On June 23, 2010, the court for the Southern District of New York ruled in favor of YouTube by dismissing Viacom's claims for copyright infringement. Viacom claimed YouTube illegally allowed users to post and share tens of thousands of Viacom's copyrighted television shows and movies. The court held that general knowledge was not enough to bar YouTube from protection under the DMCA safe harbor provision, and YouTube was therefore not liable for infringing user-generated content hosted on YouTube's site. The court reaffirmed that the burden of protecting copyrighted material remains with the copyright owner, regardless of whether the online service provider ("OSP") is generally aware of infringement occurring on its hosted websites.
1. The DMCA's "Safe Harbor"
At the heart of this case is the scope of the Digital Millennium Copyright Act's ("DMCA") "safe harbor" provision, which protects OSPs, like YouTube, from copyright liability if they promptly remove from their websites unauthorized work following formal written request of a copyright owner.
2. General Knowledge of Infringement is Insufficient
To qualify for the safe harbor, an OSP must "act expeditiously" to remove infringing content if it has "actual" knowledge of infringing activity or is aware of facts and circumstances from which infringing activity is "apparent." According to Viacom, YouTube was aware of the widespread infringement of Viacom's works on YouTube and failed to take affirmative steps to remove such material. Indeed, the court acknowledged that based on the parties' briefs, a jury could find that YouTube was not only generally aware that copyright-infringing materials were uploaded, but that it welcomed such content because it was attractive to users. In addition, these users enhanced YouTube's income from advertisers, resulting in a financial benefit attributable to the infringement.
3. Viacom Failed to Show That YouTube Had "Actual" Knowledge of Infringement
The court ruled that despite the finding that YouTube was generally aware of the infringing activity, YouTube was entitled to protection under the safe harbor provision. In order to lose the protection of the safe harbor, the defendant must be aware of "specific and identifiable infringements of particular individual items" and fail to act expeditiously to remove them upon notice. Mere knowledge of "ubiquitous" infringement is not enough to "impose a duty on the service provider to monitor or search its services for infringements."
In this respect, the Viacom court's decision is consistent with the recent decision in Tiffany v. eBay (published earlier this year). This is an example where the court held that generalized knowledge of trademark infringement by the users of a website was insufficient to support a claim for infringement against the OSP. In both cases, the courts affirmed the proposition that requiring website owners to affirmatively police their websites for infringing content would be too burdensome and inconsistent with the careful balance struck by Congress in enacting the statutory scheme.
Significantly, the court was also careful to distinguish cases such as Grokster and others involving peer-to-peer file sharing networks whose very business models depended upon infringing activity by its users. The court confirmed that, notwithstanding its YouTube decision, such defendants would remain vulnerable to claims of infringement.
4. Lessons From Viacom
The Viacom opinion confirms that, in most instances, expeditiously complying with a take-down notice by removing user-generated copyright-infringing content is enough to satisfy the safe harbor. Moreover, Viacom reconfirms that copyright owners bear the burden of protecting their copyrights by specifically identifying unauthorized activity. At the same time, the decision makes clear that the DMCA safe harbor will be available only for those website owners who genuinely appear to be making a good faith effort to stamp out infringing activity on their sites.
It is too early for YouTube and similar sites to declare victory. Viacom has vowed to appeal the decision, stating, "YouTube and Google demonstrated that required tools to limit piracy aren't impossible to find or even that difficult to implement – they fixed the problem of rampant piracy on YouTube after Viacom filed this lawsuit."
Important considerations for OSPs
Currently, the DMCA places no filtering burden on website owners. It nevertheless remains important for OSP's to:
- Exercise good faith in attempting to limit infringement on their sites
- Act timely in responding to "take down" notices
Further, as Viacom claims, OSPs like Google and YouTube have the tools to readily filter and remove infringing content thereby preventing copyright infringement.
In light of the growing costs to police content on the Internet, content owners are frustrated that website owners have no affirmative duty to prevent copyright infringement until the content owner sends notice.
The fundamentals of protecting yourself from claims of infringement include:
- Reviewing your website for compliant language and policies notifying copyright owners where to lodge a formal complaint for potential infringement.
- Establishing and following procedures to promptly respond to such complaints.
Absent these protocols, you could be financially liable under the DMCA.
Bullivant attorneys can assist you with your intellectual property litigation and transactional needs across the United States. For more information concerning the Viacom case or other intellectual property matters, please contact Stephen D. Fisher, Janet Kim Lin or Gail R. Manuguid.