Bloomberg BNA’s Patent Trademark & Copyright Law Daily™is the IP industry’s premier news service, offering objective, timely,and reliable daily news coverage and commentary from leading IP law...
Sept. 20 --Whether the safe harbors offered by the Digital Millennium Copyright Act applied to infringing content posted on an online video-sharing service could not be answered at the summary judgment stage when complicated by involvement by the service's employees, the U.S. District Court for the Southern District of New York ruled Sept. 18 (Capitol Records, LLC v. Vimeo, LLC, S.D.N.Y., No. 1:09-cv-10101-RA, 9/18/13).
Granting partial summary judgment, the court found that Vimeo was protected from liability with respect to 144 videos subject to the record companies' claims. However, with respect to 55 of the videos, there remained unresolved questions of material fact that prevented summary judgment.
Vimeo LLC of New York operates an online service, launched in 2005, that facilitates sharing of videos by users. Vimeo's terms of service require a user to affirm that he or she was involved with the creation of each uploaded video and that it is not a commercial work.
Capitol Records LLC of Los Angeles is a record label that claims rights in sound recordings. In 2009, Capitol and a dozen other record companies and music publishing companies alleged that their works were being used in Vimeo videos without authorization and sued, alleging copyright infringement. The record companies brought specific claims with respect to 199 videos.
Vimeo moved for summary judgment, arguing that it was protected from liability for any infringement by its users under the safe harbor provisions of the Digital Millennium Copyright Act, 17 U.S.C. §512. Capitol Records also moved for partial summary judgment, arguing that the safe harbor did not apply.
Judge Ronnie Abrams first dealt with several evidentiary issues. The court declined to strike a declaration by a Vimeo executive and also declined to take judicial notice of several documents as requested by the record companies. The court had not relied on the indicated documents, so the request was moot, the court said.
Finally, the court rejected Vimeo's motion to strike Capitol's Rule 56.1 statement of facts to support its motion, on the basis that the statement was too long and included non-material facts. According to the court, the length was not undue “in light of the numerous and complex issues raised in this case and the large body of evidence.”
Turning to the substantive issues, the court first determined that Vimeo qualified as a “service provider” under Section 512(c). Specifically, the court found that under Section 512(k)(1)(B), Vimeo was “a provider of online services or network access, or the operator of facilities therefor.” In this case, the court said it was undisputed that Vimeo hosted and distributed material provided by users and thus qualified as a service provider.
Next, the court determined that Vimeo had adopted and had reasonably implemented a repeat infringer policy, as required by Section 512(i)(1)(A). First, the court found that the evidence showed that Vimeo had adopted a termination policy. This was reflected in the terms of service applied to users, which stated that they would not post infringing material. This early statement of the rules was not necessarily as detailed as it later became, but it was sufficient to establish that there was a policy stating that users could be terminated for infringement.
The court also found that Vimeo had adequately communicated this policy to its users.
“While it is undisputed that Vimeo's formal 'Repeat Infringer Policy' was not published to the Website until in or about January 2011, Vimeo communicated a more general policy--threatening account termination upon any violation of the Terms of Service including single or repeated instances of infringement--from at or around its inception, and this suffices to meet the second prong of this threshold requirement.”
Finally, the court found that this policy had been reasonably implemented, as required by Section 512(i)(1)(A). There was evidence in the record of identification of repeat infringers, termination of such accounts, and disabling of accounts under review.
The Court's finding of reasonableness is also informed by the evidence of Vimeo's business circumstances as they evolved during the relevant period. That is, the policies Vimeo implemented in the first several years of its operation, as described above, were reasonable ones in light of the fact that Vimeo was, at the time, a small service provider, the twenty full-time employees of which were tasked with processing only a trickle (zero to five) takedown requests per month. The evidence reflects that as the flow of those requests increased, Vimeo's policy become more robust--first in the form of a “three strikes” rule and a blocked video list, implemented at some point after Vimeo's inception, and eventually in the form of the “Purgatory” tool, implemented later in October 2008. That Vimeo's enforcement mechanisms advanced in step with the realities of its growing business further supports the reasonableness of its implementation system.
Furthermore, the court said that in order for implementation to be “reasonable,” it need not necessarily be “perfect.” The court also found it not unreasonable for Vimeo to block only the e-mail addresses of repeat infringers, rather than their Internet protocol addresses.
Capitol Records argued that a Vimeo policy treating as a single instance of infringement all claims against a single user for the same content received in a three-day period was unreasonable because a user could then repost the same infringing content three days in a row and have only one mark against the account.
The court noted that there was no evidence that such a reposting pattern had occurred. And if such a user continued to repost infringing content day after day, that user would still quickly reach the “three strikes” mark.
The court also rejected the argument that, under Section 512(i)(2), Vimeo's privacy settings interfered with standard technical measures used by copyright holders to identify infringement because a user could specify that only designated users be able to access any video. Capitol Records had not identified any standard technical measure that this would interfere with, the court said, and “privacy settings do not constitute interference with standard technical measures.”
Thus, the court ruled that Vimeo had met the threshold requirements for qualifying for the Section 512 safe harbor. Next, the court applied the Section 512(c) requirements, which specify that the safe harbor applies to claims of “infringement of copyright by reason of the storage at the direction of a user of material that resides on a system or network controlled or operated by or for the service provider.”
Turning first to the “by reason of the storage at the direction of a user” requirement, the court noted the evidence that 10 of the 199 relevant videos had been updated by Vimeo employees who had their own user accounts.
The court was unable to determine at this stage of the litigation whether in these instances, the employees had been acting in their capacity as agents of Vimeo or whether they had been acting as individual users of the service. Thus, this constituted a triable issue and was not appropriate for summary judgment.
Turning to the remaining videos, the court rejected the argument that because Vimeo videos were downloadable that the service did not constitute “storage” under Section 512(c). The court found that there was no case law supporting Capitol's argument on this issue.
On the question of whether Vimeo had failed to act with regard to videos when it had specific knowledge of infringement, there was again an unresolved question with regard to 55 videos with which Vimeo employees had some degree of “interaction” with, such as by “liking” them. The court said that there was not enough evidence in the record to determine whether this kind of interaction imputed “red flag” knowledge of infringement, on the basis that it indicated that at least one Vimeo employee had actually viewed the video.
Thus, with respect to these 55 videos, summary judgment was not appropriate, the court said.
Capitol Records then asserted four instances in which Vimeo employees responded to general questions about infringement from users with questionable advice or not at all. For example, one reply was in the manner of “don't ask, don't tell.”
These instances, while “undoubtedly disconcerting,” were not instances of willful blindness with respect to infringement, because there were no specific videos or acts of infringement under discussion. The court said that finding this to be knowledge of infringement would entirely “swallow” the requirement of actual knowledge or red flag knowledge.
“What remains of Plaintiffs' willful blindness argument amounts to little more than their frustration that Vimeo did not use sophisticated monitoring technology in its possession to seek out and remove instances of infringing content,” the court said. Under Section 512(m), the court noted, service providers are not required to actively seek out instances of infringement.
The court next determined that Vimeo had not induced infringement and there was no establishment that it had the “right and ability to control” infringement from which it financially benefited. Here, the court again rejected the argument that Vimeo's failure to use filtering technology that was used by other video-sharing services was indicative of Vimeo's intent to profit from infringement.
Next, the court found that Vimeo had acted expeditiously to remove infringing videos, from removal in one day for a single notice, to a three-and-a-half week response time for a notice identifying 170 videos.
Finally, the court found that the DMCA safe harbor did not apply to sound recordings fixed before Feb. 15, 1972, which are governed by state law and not by the Copyright Act.
Capitol Records was represented by Christine Lepera (New York) and Marc E. Mayer (Los Angeles) of Mitchell Silberberg & Knupp LLP. Vimeo was represented by Robert Lloyd Raskopf of Quinn Emanuel Urquhart & Sullivan LLP, New York.
To contact the reporter on this story: Anandashankar Mazumdar in Washington at email@example.com
To contact the editor responsible for this story: Naresh Sritharan at firstname.lastname@example.org
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)