07 Jul 2010

YouTube finds safe harbour in Viacom copyright case

by Mary Still

Service providers in the US will be liable if they actually know of specific copyright infringements, but not if they only are generally aware of their users' infringing activity.

In a major test of the safe-harbour provisions in the US Digital Millennium Copyright Act which protect ISPs and other providers of systems or networks, a US Court has granted summary judgment in favour of YouTube in a long-running copyright case brought by Viacom and other media companies (Viacom International Inc v YouTube Inc).

At issue was YouTube's liability for the uploading by its users of material that infringed Viacom's copyright (such as clips of SpongeBob SquarePants).

What does YouTube do if there's copyright infringement?

YouTube has a policy for dealing with complaints of infringement.

It removes content automatically if it matches a portion of a reference video submitted by the copyright owner.

It removes a video if the copyright owner sends a notice complying with the requirements of the Digital Millennium Copyright Act, specifying the video that must be removed.

It also has a three-strikes policy under which repeat infringers are barred from the site (but only if their infringements have been reported manually, not identified automatically).

In response to a log of approximately 100,000 infringing videos submitted by Viacom, YouTube removed almost all those videos by the next business day.

What was the YouTube case about?

Viacom sued YouTube for copyright infringement. YouTube sought summary judgment based on the safe-harbour provisions on the basis that it did not have "actual knowledge that the material or an activity using the material on the system or network" was infringing.

The critical question for the court was whether this meant:

  • a general awareness that there were infringements; or
  • actual or constructive knowledge of specific and identifiable infringements of individual items.

Judge Stanton in the United States District Court for the Southern District of New York found that YouTube's general knowledge that its users infringed copyright laws was not enough to prevent it taking advantage of the safe-harbour provisions. Nor is YouTube required to monitor or seek out facts indicating infringing activity.

Judge Stanton also said that YouTube's policy was reasonably implemented, as required by the Digital Millennium Copyright Act. Specifically, he found that it is acceptable for YouTube to:

  • count as a strike both
    • a single notice identifying multiple infringing works uploaded by the user; and
    • multiple take-down notices identifying videos uploaded by the user within a two-hour period.
  • require the rights owner to manually request a removal before a strike is listed against a user
  • remove only the clips specified in the take-down notice and not other clips infringing the same work

What does this mean for service providers?

Although Judge Stanton has found in YouTube's favour, it is highly unlikely that this will be the last word - we expect an appeal will be lodged. In the meantime, however, any service provider which could fall under the US' Digital Millennium Copyright Act should take heart from the practical and sensible view of the Act taken by Judge Stanton.

For local service providers, the situation in Australia is governed by similar provisions in the Copyright Act. They should be able to take refuge in our safe harbour provisions if they

  • have reasonably implemented policies for repeat infringers;
  • respond promptly to take-down notices; and
  • are not receiving a financial benefit that is directly attributable to the infringing activity if they have the right and ability to control the activity.

For owners of the copyright in popular films, songs, or other entertainment, the decision illustrates the challenges in protecting their rights in an online world. Although suing a service provider might make more commercial sense than suing an 11 year old who cannot even spell "copyright infringement", this decision points out the difficulties of doing so. In light of this and similar decision, copyright owners interests may be best served by the continuous monitoring of sites such as YouTube and issuing take-down notices promptly once they become aware of infringements.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.