Stanford Center for Internet and Society

Author: Stuart Loh

Universal Music Group (“UMG”) sued Veoh Networks, Inc. (“Veoh”), an Internet-based service that allows users to share videos online, for copyright infringement. In the present proceedings, UMG moved for partial summary judgment that Veoh was not entitled to protection under 17 U.S.C. § 512(c), a safe harbor of the Digital Millennium Copyright Act designed to shield a service provider from liability arising from infringing conduct occurring “by reason of storage at the direction of the user.” In addition to storing videos uploaded by users, Veoh engaged in other activities (e.g., converting the format of the videos) to provide other users with access to them. UMG argued that because those other activities do not actually constitute storage, Veoh may not rely on § 512(c) as a shield to liability. The court denied UMG’s motion and rejected UMG’s narrow interpretation of the phrase “by reason of,” holding that such an interpretation was not consistent with its common meaning and that it would undermine the ability of § 512(c) to shield service providers from liability if they did anything with user-uploaded materials other than store it untouched. Instead, the court held that § 512(c) covers Veoh’s activities because they were designed to facilitate access to user-stored content.

A United States district court has granted Freetech, Inc.’s ("Freetech") motion for a protective order against 17 subpoenas served on Freetech’s distributors by satellite television broadcaster Echostar Satellite LLC ("Echostar"). The subpoenas sought the identity and contact information of each of Freetech’s customers that purchased a Free-to-Air receiver which was capable of being modified to decrypt Echostar’s satellite signals without its authorization. Echostar argued that such contact information would assist it in proving, in the main proceedings, that Freetech violated the Digital Millennium Copyright Act and the Communications Act. The court held that the information sought would not help Echostar prove its claims, and that the burden and intrusiveness to Freetech’s customers was too high to justify disclosure, especially in light of alternative methods of sourcing more relevant information.

Defendant Chaffee appealed a Rhode Island District Court decision granting summary judgment to Plaintiff CoxCom, Inc. The District Court held that that Chaffee violated the Cable Communications Policy Act of 1984 Section 553 and the Digital Millennium Copyright Act by selling cable filters to cable customers and marketing them as a technology to avoid being charged for pay-per-view purchases. The filters interfered with signals from the customer’s digital cable box, thereby preventing the cable company from receiving pay-per-view billing information. On appeal, Chaffee argued that summary judgment was improperly granted, that CoxCom lacked standing to sue, and that damages and injunctive relief were improperly granted. The United States court of Appeals for the First Circuit affirmed the District Court on all issues.

Stephanie Lenz sued Universal Music Corp. (“Universal”) in the U.S. District Court for the Northern District of California under 17 U.S.C. § 512(f) for misrepresentation pertaining to a DMCA takedown notice issued by Universal in relation to a video clip that Lenz posted on YouTube depicting her child dancing to the Prince song “Let’s Go Crazy,” which Universal owns the rights to. Lenz believed her use of the Prince song constituted fair use. She alleged that Universal did not consider fair use before issuing the takedown notice and therefore had misrepresented that it had done so in the takedown notice. Universal sought a motion to dismiss the case for failure to state a claim upon which relief may be granted. Universal claimed that takedown notice procedures do not require it to consider the fair use doctrine. The Court denied the motion, holding that a copyright owner, in formulating a “good faith belief” that the use of material is not authorized, must consider the fair use doctrine prior to sending a takedown notice. However, the court also indicated that this consideration does not need to be comprehensive.

Lenz v. Universal Music Corp., No. C 07-3783 JF (N.D. Cal. Aug. 20, 2008) (order denying motion to dismiss)

Io Group, Inc. (“Io”) sued Veoh Networks, Inc. (“Veoh”) in federal district court for direct, contributory, and/or vicarious copyright infringement performed in the website veoh.com, which enables the sharing of user-provided content. Veoh responded that it qualifies for safe harbor under Section 512(c) of the Digital Millennium Copyright Act (“DMCA”), which provides protection from liability for: “(1) transitory digital network communications; (2) system caching; (3) information residing on systems or networks at the direction of users; and (4) information location tools.” The United States District Court for the Northern District of California agreed with defendant Veoh and dismissed the case.

Io Group, Inc. v. Veoh Networks, Inc.

Prof. Niva Elkin-Koren has uploaded a paper titled Making Room for Consumer Under the DMCA, to be published soon in the BTLJ. The paper provides a terrific analysis and introduces an original perspective, proposing to perceive users of copyrighted works as participating consumers in information markets. This perspective underlies the argument for granting consumers more solid and meaningful protections within copyrights law, inter alia, a right to access cultural goods - despite DRMs. From the abstract:

That a string of digits-and-letters receives the honor to be composed into a song is, I think, a noteworthy development. Sure, copyright law is about fostering creativity, but in this case it happened in a rather odd sense. People sing the code to make it clear (even to the most shortsighted court) that there is a free speech issue here. Anyway, the people at Digg.com say they will fight till the end. "If we lose, then what the hell, at least we died trying," said Kevin Rose, the company founder. The NYT article from yesterday covering the story featured co-NR CIS Fellow Prof. Chris Sprigman.

Plaintiff Auto Inspection Services, Inc. (“AIS”) sought a preliminary injunction against Defendants Flint Auto Auction, Inc., Inviso, Inc., and Priority Inspections, Inc. (collectively “FAA”) for copyright infringement and violation of the Digital Millennium Copyright Act (“DCMA”) with respect to an automotive inspection program. In the copyright infringement action, the Court found that AIS failed to demonstrate substantial similarity of their program with FAA’s program. In the DMCA claim, the Court found that AIS failed to demonstrate that FAA circumvented a technological measure that controls access to AIS’s source code. The Court therefore dissolved a TRO against FAA and denied AIS’s motion for a preliminary injunction.

Plaintiff Auto Inspection Services, Inc. (“AIS”) sought a preliminary injunction against Defendants Flint Auto Auction, Inc., Inviso, Inc., and Priority Inspections, Inc. (collectively “FAA”) for copyright infringement and violation of the Digital Millennium Copyright Act (“DCMA”) with respect to an automotive inspection program. In the copyright infringement action, the Court found that AIS failed to demonstrate substantial similarity of their program with FAA’s program. In the DMCA claim, the Court found that AIS failed to demonstrate that FAA circumvented a technological measure that controls access to AIS’s source code. The Court therefore dissolved a TRO against FAA and denied AIS’s motion for a preliminary injunction.

So, thanks to the Librarian of Congress, film professors and media studies professors can now make a compilation of film clips for class without breaking the law. But ONLY film professors and media studies professors.

From the Copyright Office’s website:

The Librarian of Congress, on the recommendation of the Register of Copyrights, has announced the classes of works subject to the exemption from the prohibition against circumvention of technological measures that control access to copyrighted works. Persons making noninfringing uses of the following six classes of works will not be subject to the prohibition against circumventing access controls (17 U.S.C. § 1201(a)(1)) during the next three years.