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ISP Liability for the Acts of Its Customers

ISP liability is the legal responsibility of Internet Service Providers (ISPs) for the actions of their users regarding copyright infringement and other intellectual property (IP) rights.

Copyright law gives exclusive rights to copyright holders. These rights holders have the legal right to do the following with their works:

  • Display
  • Reproduce
  • Distribute
  • Perform

Copyright protection is an essential aspect of intellectual property rights. These IP rights ensure that creators have autonomy over the use of their copyrighted works. But online copyright infringement has become vital in today's digital age. These copyrighted works are being shared and distributed without the copyright owner's permission.

Internet users sharing or uploading copyrighted content without permission from the copyright owner is considered infringing content. ISPs may accidentally help the circulation of infringing copies by providing a platform for online users. This infringing activity will likely have consequences.

This article takes you through an overview of ISP liability for the acts of its customers who spread infringing material. It also covers how to protect your works.

A Brief History of ISP Liability

At the beginning of the internet, ISPs were outlets for transmitting data. Under the "common carrier" concept, ISPs were shielded from liability for the content shared by their users. This concept held ISPs responsible for data transmission but not the content.

Communications Decency Act (CDA) of 1996

The CDA was one of the first attempts to help regulate the internet. The CDA provided ISPs and online service providers broad immunity from liability for user-generated content. This immunity allowed ISPs to host the content of users without fear of accountability.

DMCA Safe Harbor (1998)

Congress passed a series of laws, including the Digital Millennium Copyright Act. These laws took the side of the ISPs. The Digital Millennium Copyright Act (DMCA) introduced safe harbor provisions. ISPs were granted immunity from copyright infringement liability if they followed specific requirements. One requirement was to remove the alleged infringement when notified by the copyright holder. Under the DMCA, ISPs are not automatically held responsible for users uploading or sharing copyrighted content.

Copyright Holders Can Hold ISPs Liable for Copyright Infringement

ISPs can be liable for the copyright infringement of their users. But only in minimal circumstances. There are three ways that an ISP could be responsible for copyright infringement:

  • Direct infringement: Direct infringement is when the ISP knowingly hosts copyrighted material and receives a direct financial benefit from it.
  • Vicarious liability: An ISP is liable vicariously if the ISP has the right and ability to control its users and receives a direct financial benefit from copyright infringement.
  • Contributory infringement: If an ISP knows about the illegal sharing of copyrighted content and helps with it, they are likely held responsible for the infringement.

Almost all cases rely on the contributory infringement theory. Direct infringement rarely occurs. Proving vicarious liability is tough. You need to show that the ISP had both the right and the power to control its customers. Although it may be difficult to find evidence that this was the case, ISPs must still be careful. Their terms of service agreement may establish that they have the right and ability to control their customers.

ISP Liability for Copyright Infringement and the DMCA

Title II of the DMCA, a part of the United States Code (USC), governs ISP liability. The USC is the compilation of federal laws.

The DMCA generally shields ISPs under a safe harbor provision from copyright infringement liability. To qualify for the safe harbor's protection, an ISP must:

  1. Lack actual knowledge of the copyright infringement;
  2. Not be financially benefiting from the infringement;
  3. Follow any "notice" or "takedown" provisions for removing copyright material; and
  4. Establish an agent for dealing with copyright infringement complaints

Imagine there's a record company called Taylor Made Records. They discover that one of their CDs is on a website hosted by an ISP called Mega Stars without permission. Mega Stars must not know about these illegal copies to avoid getting in trouble. Also, they must have someone that Taylor Made Records can tell about the issue in charge.

When Taylor Made Records tells Mega Stars about the problem, Mega Stars has to remove the illegal material or stop the user from using the website. But if Mega Stars doesn't have anyone to contact or doesn't take action after getting the message, Taylor Made Records can take Mega Stars to court. Mega Stars can't use the DMCA to avoid being responsible for what happened.

Determining whether using copyrighted content in user-generated content is fair use or infringement can be complex. Fair use is a legal doctrine that allows limited use of copyrighted works without the rights holder's permission.

The judiciary, including the Supreme Court, plays a significant role in interpreting and applying these provisions. It must ensure a balance between protecting intellectual property rights and encouraging the growth of e-commerce and online services.

ISP Liability for Defamation and Obscenity Under the Communications Decency Act

Section 230 of the Communications Decency Act (CDA) protects ISPs from liability for what their users say online. For example, defamation and obscenity protection make ISPs different from newspapers and magazines.

In one of the first important cases about saying bad things online, the Drudge Report claimed that an aide of President Clinton had a history of spousal abuse. The aide then filed suit for defamation against the Drudge Report and the ISP that hosted it, AOL. The court stated that because AOL was an ISP, it was protected by the CDA. The CDA states that ISPs are not responsible for the things other people say on their platform.

ISP Liability Abroad

The same shielded conduct for a U.S. ISP is prosecuted in countries such as England and Germany. Each country has its laws, which vary from country to country. You should know what is protected in countries where you expect people to view your content.

Find an Intellectual Property Law Attorney

If you're worried about ISP liability for your company, it's a good idea to talk to a knowledgeable lawyer. An intellectual property attorney can explain your potential liability. They will assist in defending your actions.

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