Federal court decisions continue to clarify the laws that protect sites and services that host user generated content (“UGC”) from claims by content owners whose rights are infringed by such UGC. Recently, the Second Circuit Court of Appeals instructed the district court for the Southern District of New York to reconsider its ruling that YouTube is protected from copyright liability by the Digital Millennium Copyright Act’s (“DMCA”) safe harbor provisions. ( SeeClient Advisory - Second Circuit Vacates and Remands YouTube Summary Judgment Under the Digital Millennium Copyright Act) The lower court determined that YouTube Inc.'s general awareness of infringing clips did not impose an affirmative duty to search for or remove infringing material. In order for such a duty to be imposed, the court held that YouTube would need to have specific knowledge or awareness of infringing content and would also need to exert control over user activity on its website to influence or participate in the infringement. The burden remains on the copyright holder, not the service provider, to locate and identify infringing material. This case has already resulted in courts reexamining determinations of “red flag” awareness, on May 14, 2013, the Southern District of New York withdrew its grant of summary judgment in Capitol Records v. MP3tunes, L.L.C. to consider whether MP3tunes had knowledge of infringing content (Capitol Records, Inc. v. MP3tunes, LLC, 07 Civ. 9931 (S.D.N.Y. May. 14, 2013)).

On remand, the lower court was directed to reconsider whether YouTube: (i) had knowledge or awareness of any specific infringing clips; (ii) was willfully blind to any specific infringing clips; (iii) had the right and ability to control infringing activity within the meaning of 512(c)(1)(B); and (iv) syndicated any clips to third parties to claim protection of the 512(c) safe harbor. On April 19, 2013, the lower court ruled in favor of YouTube on each issue, granting YouTube’s renewed motion for summary judgment and dismissing the complaint (Viacom Intern. Inc. v. YouTube, Inc., 2013 WL 1689071 (S.D.N.Y. April 18, 2013)). This ruling further supports broad protection to UGC service providers under the DMCA safe harbor provisions, as affirmed by the Ninth Circuit, and provides important guidance for both content owners and UGC service providers.

In its reconsideration, the lower court found the following:

  1. YouTube did not have Knowledge or Awareness of any Specific Infringing Clips

While the sheer volume of videos uploaded to YouTube makes the ability to police for content difficult, Viacom argued that the burden of proving whether YouTube had knowledge or awareness of specific infringing clips was on YouTube. The district court disagreed, however, ruling that, under the DMCA, a service provider has no obligation to monitor or seek out infringing activity, and therefore the burden of proving knowledge of specific infringing clips fell on the copyright owner. The court declined to shift the burden to require YouTube and other service providers to take a more proactive role in policing content.

  1. YouTube was not Willfully Blind to any Specific Infringing Clips

The lower court held that Viacom did not prove YouTube was willfully blind to specific infringing clips. According to the court, willful blindness occurs when a person consciously avoids confirming a fact that could lead to liability for copyright infringement. Under 512(m) a service provider has no duty to monitor for potentially infringing content. What disqualifies a service provider from the DMCA’s protection is blindness to “specific and identifiable instances of infringement.” The court found that the DMCA does not require YouTube to determine the location of specific infringing clips if these locations are not provided by the copyright owner and YouTube did not know of them.

  1. YouTube did not have the Right and Ability to Control Infringing Activity within the Meaning of 512(c)(1)(B)

According to the district court, under 512(c)(1)(B), “something more” than ordinary power by the service provider over the content on its website is required for the “right and ability to control” infringing activity to forfeit protection of the safe harbor provision. As an example of “something more,” the court suggested that a service provider’s substantial influence on the activities of users by establishing a monitoring system, or approving or denying posting of certain content would constitute the right and ability to control infringing activity. It is important to note that the court’s interpretation of the DMCA differs from judicial decisions regarding immunity under Section 230 of the Communications Decency Act (“CDA”), where such monitoring or approval activities do not negate publisher immunity for certain non-intellectual property claims arising out of UGC. The court in YouTube also held that mere knowledge of prevalent infringing activity on its website does not itself forfeit the DMCA’s safe harbor, unless the service provider is influencing or participating in the infringement, which is similar to CDA jurisprudence. Applying the facts in this case, the court found that even though YouTube selectively decided to takedown certain infringing videos, such as whole movies or television episodes, and refrained from establishing an infringement alert system in order to increase its page views and advertising revenue, YouTube did not engage in “something more” under Section 512(c)(1)(B) and did not forfeit the protection of the DMCA safe harbor.

  1. YouTube’s Syndication to Third Parties was protected by the 512(c) Safe Harbor Provision

YouTube has several syndication agreements with Apple, AT&T and others that provide access to user-stored videos via transcoding, a method used to make content available on mobile devices. The lower court held that YouTube’s activities pursuant to its syndication agreements are protected by the DMCA’s safe harbor provision because the agreements merely allow access to material stored at the direction of users in a different coding format via an automated process.

Similar to the protection afforded to online service providers under the CDA, website operators may not be responsible for infringing or objectionable material uploaded to their websites by third-party users if they meet the statutory requirements. As noted above, however, the DMCA and CDA requirements differ. The lower court’s decision is another major victory for service providers and once again shows the reluctance of courts to place the burden on service providers to monitor or search for infringing content on their websites. The court was only willing to shift the burden to service providers if they vigilantly monitor or attempt to control third-party postings. Absent such actions, the court determined that it is the copyright owner’s burden to police for infringing material, making it a more time intensive and costly task for copyright owners. Service providers should keep both the CDA and the DMCA in mind when implementing monitoring programs or exercising editorial control.

In Conclusion

In light of this decision, Viacom has already announced its intentions to initiate another appeal. This is certainly not the last word on the DMCA safe harbor provisions for service providers. As stated above, due to the Second Circuit Court of Appeals’ slight alteration of the “red flag” test under the DMCA in YouTube (Viacom International, Inc. et al v. YouTube Inc., et al and The Football Association Premier League Ltd. et al v. YouTube Inc., et al., 2012 WL 1130851(2d Cir., April 5, 2012)), the SDNY has agreed to withdraw its grant of summary judgment in the 2011 case Capitol Records v. MP3tunes, L.L.C. to determine whether MP3tunes had “red flag” knowledge of infringement (Capitol Records, Inc. v. MP3tunes, LLC, 07 Civ. 9931 (S.D.N.Y. May. 14, 2013)).