Kickin' it Old School: DMCA Safe Harbor Ruling Relies on VCR Case

The Ninth Circuit Court of Appeals ruled this week that a YouTube-style video-sharing website was protected under the Digital Millennium Copyright Act (DMCA) safe harbor provision in a copyright infringement lawsuit stemming from user-uploaded music videos.

The now-defunct Veoh Networks (Veoh) operated a publicly-accessible website that enabled users to share videos with other users. Universal Music Group (UMG), one of the world’s largest record and music publishing companies, filed a direct and second copyright infringement lawsuit against Veoh in 2007 after Veoh users, without UMG’s authorization, downloaded videos containing UMG-copyrighted songs.

UMG claimed that Veoh had not done enough to stop its users from sharing copyrighted music videos through the website. "Veoh responded in court filings that it had done everything necessary to qualify for the protections of [DMCA], -- including disabling the infringing videos and terminating the accounts of thousands of infringing users," according to Thomson Reuters News & Insight.

This week, the Ninth Circuit ruled that Veoh was not liable in the copyright infringement lawsuit because "UMG ignored DMCA notice protocol by failing to send takedown notices," reports The Hollywood Reporter. In the opinion, the court ruled that copyright holder -- not the Internet Service Provider (ISP) --has the initial responsibility to identify a specific infringing video, and must send takedown notices to the ISP to protect its material.

UMG had argued to the Ninth Circuit Court of Appeals that the takedown notice was not the exclusive source of infringement notification, and that Veoh must have known that the music on its website was unauthorized because it did not have a license from any major music company to host such content.

The Ninth Circuit, relying on the Supreme Court's 1984 Sony Corp. of America v. Universal City Studios, Inc. decision, disagreed.

In Sony, the Supreme Court held that there was no precedent for copyright infringement liability based on the theory that Sony sold VCRs with constructive knowledge that their customers may use the machines to make unauthorized copies of copyrighted material. Because VCRs could be used for "non-infringing" purposes, the Supreme Court refused to impute knowledge of infringement.

Here, the Ninth Circuit found that many music videos could legally appear on Veoh, so the court refused to assume that Veoh knew that users were sharing copyrighted material without permission.

While ISPs are rejoicing in Veoh's victory before the Ninth Circuit Court of Appeals, the debate over the DMCA safe harbor provision in copyright infringement lawsuits is not over; the Second Circuit Court of Appeals is expected to issue an opinion soon in a nearly-identical case, Viacom vs. YouTube. If the Second Circuit takes a different position, it could set the stage for one of the biggest Supreme Court copyright showdowns in years.

Related Resources:

• UMG Recordings v. Shelter Capital Partners (FindLaw's CaseLaw)
• File Sharing Site Hotfile Sues Warner Bros. Over DMCA Abuse (FindLaw's Technologist)
• Copyright Law Enters the Digital Age (FindLaw)