What started as a copyright litigation between two relatively minor parties has morphed into an appeal before the US Court of Appeals for the Seventh Circuit that has seen amici briefs from the likes of the Motion Picture Association of America (MPAA), Google, and Facebook.

The case, Flava Works, Inc. v. Marques Rondale Gunter, began before the US District Court for the Northern District of Illinois. The plaintiff, Flava Works, Inc., produces and distributes adult-entertainment videos. It discovered that several of its copyrighted videos had been embedded on the defendant’s myVidster.com website by users of that site. When the defendant failed to take prompt remedial action to remove the infringing videos and to prevent the use of its site by repeat infringers, the plaintiff sued.  

Embedding a video (also known as in-line linking) allows a website to show a video on its site even if the copy of the video is technically housed on another site. Due to the way the video is displayed, the viewer often has no idea that the content she is viewing actually comes from a different website.  

The district court in Flava Works found that “a website’s servers need not actually store a copy of the work in order to ‘display’ it.” Thus, in the district court’s view, a website like myVidster.com could be liable for copyright infringement for allowing its users to embed infringing videos on its site even if the copies of the videos are housed on third-party sites. It is this decision that brought the MPAA, Google, and Facebook into the case as amici.

The district court’s decision seemingly goes against the US Court of Appeals for the Ninth Circuit’s famous decision in Perfect 10, Inc. v. Amazon.com, Inc., which established the so-called “server test.” Applying the server test, the Ninth Circuit found that a party (Google) could not be directly liable for copyright infringement by embedding links to copyrighted still images if it did not house a copy of the copyrighted content on its own servers.

In its brief in Flava Works, the MPAA argues that the server test is wrong on its face, and should not be followed in the Seventh Circuit. In addition, the MPAA argues that the server test is inapplicable to the case at bar because it turned on the copyright owner’s exclusive right “to display” its works, whereas the conduct at issue in Flava Works involves the copyright owner’s right “to perform” the work. This distinction is crucial according to the MPAA, because the statutory definition of “to display” a copyrighted work refers to a “copy” of the work, while the statutory definition of “to perform” a work does not. Thus, when discussing a violation of the right to perform the work, it is irrelevant whether the copy of the work is housed on the defendant’s servers or elsewhere. The MPAA therefore urges the Seventh Circuit to uphold the district court’s decision that embedding a video can amount to copyright infringement, even if the video is not housed on the website’s servers.  

By contrast, Google and Facebook argue that embedding a video is simply a form of linking to a video on another site. They state that such linking can never be direct copyright infringement, because the website does not transmit or otherwise communicate the copyrighted work, it simply transmits a link to the work, and a link (or URL) is not copyrighted. Thus, while the person that embedded the video may be liable for secondary copyright infringement, she can never be liable for direct copyright infringement. Next, Google and Facebook argue that myVidster.com cannot be liable for secondary copyright infringement because “one cannot be liable for contributing to contributory infringement; one must contribute to direct infringement in order to be liable.” In other words, since the user who embedded the video on myVidster.com is not the direct infringer, myVidster.com cannot be liable for contributory copyright infringement.  

While Google and Facebook understandably attempt to avoid liability for entities like themselves and myVidster.com by arguing that the user who uploads a video cannot be the direct infringer and therefore the larger entities cannot be contributory infringers, the MPAA argues that a party can be liable for contributory infringement no matter where in the chain of infringement it falls. In the MPAA’s view, whether a party is contributorily liable turns on whether the party materially contributed to the infringement, not how far removed from the direct infringer the party is. Thus, if companies like myVidster.com materially contribute to the infringement by providing a forum for entities to embed infringing videos or by failing to disable or block embedded videos that they know are infringing, the companies can be liable for contributory copyright infringement.

It is no surprise that the MPAA, Google, and Facebook submitted amici briefs in Flava Works, as the outcome could have serious impacts on their business models. On the one hand, the studios MPAA represents and other copyright holders are often unable to track down the entity that initially posted an infringing video on the Internet, though they can locate larger entities that allow users to embed those videos on their sites, such as myVidster.com. In the MPAA’s view, “(g)iven the massive and often anonymous infringement on the internet, the ability of copyright holders to hold gateways like myVidster liable for secondary infringement is crucial in preventing piracy.” On the other hand, companies like Google and Facebook have established business models (such as YouTube) that rely heavily on the ability to embed videos. In their view, rejecting the server test will “imperil the investment decisions and licensing agreements that have been made in reliance on that well-founded approach.”