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Jessica McKinney | Bloomberg Law On July 6, 2011, a number of Internet service providers ("ISPs")1 entered into a voluntary agreement2 with The Motion Picture Association of America, Inc. ("MPAA"), The Recording Industry Association of America, Inc. ("RIAA"), and certain members of those organizations3 (collectively, the "Content Owner Representatives"). The agreement addresses online copyright infringement through a six-step "Copyright Alert Program" and establishes the Center for Copyright Information ("CCI")4 "to support implementation of the system and educate consumers about the importance of copyright."5 While the agreement may not be as harsh as the "three strikes" laws that have been enacted in countries such as France and the United Kingdom, where penalties for violations include disconnection from Internet access, it nevertheless amounts to private enforcement of copyright without any judicial oversight and contains a number of troubling provisions.
Copyright Alert ProgramNotices Sent by Content Owner Representatives to ISPs. Pursuant to the parties' agreement, Content Owner Representatives may send notices6 of alleged infringement to the ISPs. Such notices must clearly identify: (1) the copyrighted work at issue and its owner; (2) the basis for claiming the right to enforce the copyright on behalf of the owner; (3) "a statement that the notifying Content Owner Representative or its agent has a good faith belief that use of the material is not authorized by the Copyright Owner, its agent, or the law"; (4) "a statement that the information in the ISP Notice is accurate and that, under penalty of perjury, the Content Owner Representative is authorized to act on behalf of the Copyright Owner whose rights were allegedly infringed"; and (5) technical information to identify the subscriber.7 The Content Owner Representatives agreed to focus their notices on "instances of P2P Online Infringement involving files or data consisting primarily of infringing material or containing unauthorized copyrighted works in complete or substantially complete form," and to avoid "instances of P2P activity in which de minimis amounts of allegedly infringing material are incorporated into files or data consisting primarily of non-infringing material."8 Further, the methodologies used by the Content Owner Representatives to identify infringements must be reviewed by an "Independent Expert"9 and not found to be inadequate. While the Independent Expert may make recommendations as part of its review, a Content Owner Representative's failure to adopt a recommendation does not constitute a breach of the agreement. Copyright Alerts. Each ISP must "develop, implement and independently enforce a Copyright Alert Program" as described in the agreement.10 An ISP's Copyright Alert Program must consist of six Copyright Alerts, and is triggered by receipt of a notice from a Content Owner Representative. There must be a seven day grace period between alerts to any one subscriber. If an ISP who has received a notice regarding a particular subscriber does not receive any further notices for 12 months, then all prior notices and Copyright Alerts associated with the subscriber's account are expunged and the next notice received by the ISP resets the program. Each Copyright Alert Program must adhere to the following four-step framework: Initial Educational Step: After receiving a notice, an ISP must send up to two "Educational Step Copyright Alerts" to the affected subscriber. These alerts must include information regarding the alleged infringement (as detailed in the notice) and must inform the subscriber that: (1) copyright infringement is illegal and a violation of the ISP's Acceptable Use Polices ("AUP") or Terms of Service ("TOS"); (2) users of the account must not engage in copyright infringement; (3) there are legal ways to obtain copyrighted works; (4) the ISP may apply "Mitigation Measures" if additional Copyright Alerts are sent to the subscriber; (5) in appropriate circumstances the ISP may adopt, in addition to the Mitigation Measures, "those measures specifically authorized by section 512 of the DMCA and/or actions specifically provided for in the Participating ISP’s AUP and/or TOS including temporary suspension or termination"11; (6) the subscriber "will have an opportunity to challenge any Copyright Alerts associated with the Subscriber’s account before a Mitigation Measure is applied and may therefore wish to preserve records or information that could be used to show that the Subscriber’s conduct was non-infringing"12; and (7) the CCI's website provides further information on the Copyright Alert Program. Acknowledgement Step: If additional notices are sent to the ISP regarding the subscriber's account, the ISP must send two "Acknowledgement Step Copyright Alerts" to the subscriber. These alerts require the subscriber to acknowledge receipt in some way, e.g., by directing the subscriber's browser to a temporary landing page before additional Internet access is permitted or by using a pop-up notice. The alerts must state "that the Subscriber, by acknowledging the notice, agrees immediately to cease, and/or agrees to instruct other users of the Subscriber’s account to cease infringing conduct, if any exists."13 The alerts must also state the following: "upon receipt of lawful process requiring production of records or pursuant to a qualifying claim that the Subscriber has made via the Independent Review Program . . . the Participating ISP may provide relevant identifying information about the Subscriber and the Subscriber’s infringing conduct to third parties," including law enforcement agencies or Content Owner Representatives or their agents.14 Mitigation Measures Step: If the ISP receives further notices regarding the subscriber's account, it must send one "Mitigation Measure Copyright Alert" to the subscriber. This alert requires acknowledgment of receipt, must state that prior warnings regarding alleged infringement were received by the subscriber, and must inform the subscriber of what specific Mitigation Measure will be applied to his account. The alert must also inform the subscriber that, unless he requests review "via the dispute resolution program set forth in [the agreement] or as otherwise permitted in the Participating ISP's AUP or TOS or as permitted by law, at the election of the Subscriber," the Mitigation Measure will be applied after 10 business days or 14 calendar days (time length to be decided at the ISP's discretion).15 The Mitigation Measure must be one of the following, "determined by the Participating ISP and applied in a manner reasonably calculated, in the Participating ISP’s reasonable discretion, to help deter P2P Online Infringement": (1) "temporary reduction in uploading and/or downloading transmission speeds"; (2) "temporary step-down in the Subscriber’s service tier"; (3) "temporary redirection to a Landing Page until the Subscriber contacts the Participating ISP to discuss with it the Copyright Alerts"; (4) "temporary restriction of the Subscriber’s Internet access for some reasonable period of time as determined in the Participating ISP’s discretion"; (5) "temporary redirection to a Landing Page for completion of a meaningful educational instruction on copyright"; or (6) "such other temporary Mitigation Measure as may be applied by the Participating ISP in its discretion that is designed to be comparable to those Mitigation Measures described above."16 The agreement specifies that ISPs are not required to apply a Mitigation Measure "that knowingly disables or is reasonably likely to disable a Subscriber’s access to any IP voice service (including over-the-top IP voice service), e-mail account, or any security service, multichannel video programming distribution service or guide, or health service (such as home security or medical monitoring) while a Mitigation Measure is in effect."17 In addition, ISPs have discretion to waive a Mitigation Measure, though only one waiver may be issued to an account. Post Mitigation Measures Step: If further notices are sent to the ISP after a Mitigation Measure is applied, the ISP must again send the subscriber one Mitigation Measure Copyright Alert. The ISP must apply a Mitigation Measure (which may be a different measure than previously applied) after either 10 business days or 14 calendar days unless the subscriber requests review. At this stage, the alert must also inform the subscriber that he "may be subject to a lawsuit for copyright infringement by the Copyright Owners" and that in appropriate circumstances, continued infringement may lead to "the imposition of action consistent with section 512 of the DMCA and/or actions specifically provided for in the Participating ISP’s AUP and/or TOS including temporary suspension or termination."18 Following the sixth alert, the ISP "may, at [its] sole discretion, send additional Mitigation Measure Copyright Alerts and apply additional Mitigation Measures, subject to the Subscriber’s right to challenge Copyright Alerts at this step."19 Even if the ISP chooses to cease sending alerts, it must still track and report the number of notices sent with respect to the subscriber's account, "so that information is available to a Content Owner Representative if it elects to initiate a copyright infringement action against that Subscriber."20
Independent Review ProgramOnce a subscriber has received a Mitigation Measure Copyright Alert, he may challenge that alert, as well as any prior alerts,21 through the "Independent Review Program" established by the agreement. While the Independent Review Program program "is intended to provide an alternative, fast, efficient and low-cost means for Subscribers and Copyright Owners to obtain independent resolution of genuine disputes that may occur in connection with the Copyright Alert program," it is a non-exclusive procedure; thus, subscribers or copyright owners are free to file lawsuits in the courts to address any disputes.22 To initiate the independent review process, a subscriber must electronically submit an Application to Commence Independent Review ("ACIR") form (to be provided by the subscriber's ISP with the Mitigation Measure Copyright Alert), along with any related materials, within 10 business days of receiving the alert. The subscriber must pay a $35 fee23 to file the application. Failure to file within the prescribed deadline waives the subscriber's right to seek independent review of the Mitigation Measure at issue. If a Reviewer24 determines that the ACIR form and accompanying materials are "substantially incomplete," the case must be denied without prejudice, and the subscriber must be given five business days to amend the materials.25 The ACIR form contains an authorization to disclose certain personal information, including the subscriber's identifying information, to the Reviewer and the subscriber's ISP. The agreement provides, however, that "all Subscriber personal information will be held in confidence and not disclosed to the Copyright Owner" unless "required by judicial order or other legal process."26 Additionally, if the subscriber asserts an authorization defense, "then the Reviewer may, in his or her discretion, disclose to the Copyright Owner only such personal information concerning the Subscriber as is reasonably necessary to permit the Copyright Owner to rebut a claim of authorization if that information is required for such purposes."27 The agreement lists only six grounds for independent review: (1) misidentification of account; (2) unauthorized use of account; (3) authorization; (4) fair use; (5) misidentification of file; and (6) work published before 1923.28 Notably, if a contested alert "alleges infringing activity with respect to multiple works, the Independent Review process may be invoked by a Subscriber only if the Subscriber offers a defense as to every work cited in the Copyright Alert."29 The alert will be deemed valid "if the Subscriber is found to have no valid defense as to any one work cited in the Copyright Alert, unless the Independent Review establishes a pattern of invalid allegations in the Copyright Alert sufficient to cast substantial doubt on the Copyright Alert’s remaining allegations."30 With respect to the first defense—misidentification of account—there is a rebuttable presumption that "automated systems for capturing IP addresses or other information in accordance with [the] Methodologies" used by Content Owner Representatives "work in accordance with their specifications," unless any such methodology has been issued a Finding of Inadequacy by the Independent Expert (who, pursuant to the agreement, must periodically assess the methodologies adopted by content owners).31 The second defense—unauthorized use of account—is established if a subscriber "adequately and credibly demonstrates that the alleged activity was the result of unauthorized use of the Subscriber’s account by someone who is not a member or invitee of the household (e.g., via an unsecured wireless router or a hacked Internet connection) of which the Subscriber was unaware and that the Subscriber could not reasonably have prevented."32 Significantly, a subscriber may assert the unauthorized use defense only one time unless he demonstrates, by clear and convincing evidence, that subsequent "unauthorized use occurred despite reasonable steps to secure the Internet account and that the breach of such security could not reasonably have been avoided."33 To prevail on the third defense—authorization by the copyright owner or its authorized representative—a subscriber must submit "written or other documented evidence" in support of the defense.34 To succeed on the fourth defense of fair use, a subscriber must "adequately and credibly demonstrate fair use of the copyrighted work under prevailing principles of copyright law."35 The fifth defense—misidentification of file—requires a subscriber to show "that a factual error was made in identifying the file at issue as consisting primarily of the alleged copyrighted work"; like the first defense, the agreement specifies that in considering this defense, there is a rebuttable presumption that the methodology used by the Content Owner Representative "works in accordance with its specifications" unless previously found inadequate.36 To prevail on the sixth defense, a subscriber must prove "that the alleged copyrighted work in question was actually published prior to 1923," i.e., that the work is in the public domain.37 Pursuant to the agreement, a Reviewer may not issue a written opinion as part of the independent review process. In addition, proceedings "will take place exclusively on the written record, and there shall be no live hearings."38 The agreement also forbids the parties to a dispute from conducting discovery, and explicitly states that "no party shall have any obligation to respond to any request for information or to provide any particular information, except as described herein."39 Finally, the agreement provides that "[i]n any judicial proceeding between a Subscriber and a Copyright Owner concerning subject matter that is or has been the subject of Independent Review, neither the Subscriber nor the Copyright Owner shall seek to enter into evidence, or otherwise refer to or cite, either the fact of the Independent Review or any outcome of the Independent Review."40
DMCA ImplicationsThe agreement acknowledges that "the limitations on ISP liability under the DMCA are conditioned on an ISP’s adoption and reasonable implementation of a policy that provides for the termination in appropriate circumstances of subscribers and account holders who are repeat infringers ('DMCA Termination Policy')."41 The agreement emphasizes, however, that it "does not and is not intended to establish any legal inference regarding any ISP that does not participate in the Copyright Alert program or to address whether or not any ISP has adopted and reasonably implemented a DMCA Termination Policy."42 While the agreement attempts to distance itself from the DMCA and, in particular, from the DMCA Termination Policy, a future court in an infringement action may arguably consider an ISP's participation in the Copyright Alert Program (e.g., the number of notices received by an ISP with respect to a particular account, keeping in mind that an ISP is required to track and report such notices even after it sends the requisite six alerts) in deciding whether the ISP is eligible for safe harbor protection under 17 U.S.C. § 512(i)(1)(A). In addition, the DMCA provides that a copyright owner is liable for damages, including costs and attorneys' fees, if he "knowingly materially misrepresents [in a DMCA takedown notice] . . . that material or activity is infringing."43 The agreement does not contain a similar provision or any other meaningful safeguards that address potential abuse of the notice system by Copyright Owner Representatives. Disclaimer This document and any discussions set forth herein are for informational purposes only, and should not be construed as legal advice, which has to be addressed to particular facts and circumstances involved in any given situation. Review or use of the document and any discussions does not create an attorney-client relationship with the author or publisher. To the extent that this document may contain suggested provisions, they will require modification to suit a particular transaction, jurisdiction or situation. Please consult with an attorney with the appropriate level of experience if you have any questions. Any tax information contained in the document or discussions is not intended to be used, and cannot be used, for purposes of avoiding penalties imposed under the United States Internal Revenue Code. Any opinions expressed are those of the author. The Bureau of National Affairs, Inc. and its affiliated entities do not take responsibility for the content in this document or discussions and do not make any representation or warranty as to their completeness or accuracy. ©2014 The Bureau of National Affairs, Inc. All rights reserved. Bloomberg Law Reports ® is a registered trademark and service mark of The Bureau of National Affairs, Inc.
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