On December 20, 2011, the Ninth Circuit affirmed a district court grant of summary judgment to an operator of a publicly accessible website enabling users to share digital videos with other users. The Court’s opinion in UMG Recordings, Inc. v. Shelter Capital Partners LLC, 667 F.3d 1022 (9th Cir. 2011) confirms the strength of the safe harbor provisions of the Digital Millennium Copyright Act (“DMCA”), codified at 17 U.S.C. § 512(c), for internet service providers faced with allegations of copyright infringement by publishers and artists.
In this case, despite efforts by the website operator to prevent copyright infringement on its system, some of its users were able to download unauthorized videos containing music for which the plaintiff owned the copyright. In September of 2007, the plaintiff publisher brought suit against both the website owner and three of its investors, alleging direct, vicarious and contributory copyright infringement, as well as inducement of copyright infringement. The district court granted summary judgment in favor of the defendants on the basis of the DMCA’s safe harbor provision. The safe harbor protects service providers who (i) control systems or networks on which copyrighted material is posted without their actual knowledge; (ii) do not receive a financial benefit directly attributable to the infringing activity; and (iii) take down such material upon notice from the copyright owner.
The Ninth Circuit affirmed, noting first that facilitating access to content, if done at the direction of a user, falls within the ambit of the “storage” language of the safe harbor: “We hold that the language and structure of the statute, as well as the legislative intent that motivated its enactment, clarify that [the safe harbor] encompasses the access-facilitating processes that automatically occur when a user uploads a video .” UMG Recordings, 667 F.3d at 1031. The Court noted that the defendants’ system, allowing user-submitted content to be processed and recast in a readily accessible format, satisfied the safe harbor requirement that the content submission be “user-directed.” Id. at 1035. The Court also noted that general knowledge that one’s services could be used to share infringing material is insufficient to meet the “actual knowledge” standard of the DMCA safe harbor: According to the Court: “[m]erely hosing a category of copyrightable content, such as music videos, with the general knowledge that one’s services could be used to share infringing material, is insufficient to meet the actual knowledge requirement under [the DMCA safe harbor].” Id. at 1038, 1042. As to the investor defendants, the Court held they were not liable for secondary copyright infringement because there was no allegation that they “agreed to work in concert” to induce the alleged infringement in question—the mere funding of the plaintiffs’ enterprise is not enough to support secondary liability. Id. at 1047.
By affirming the district court grant of summary judgment on the copyright infringement claims, the Ninth Circuit re-affirmed the broad scope of the safe harbor protections of the DMCA for digital service providers and their investors.