Sunday, March 21, 2010

The Viacom v. YouTube briefs: after the dust has settled

I've been swamped and haven't been able to give the summary judgment briefs in the Viacom v. YouTube case the attention they deserve. I just wanted to make a few points that I think have gotten lost among all of the attention (justifiably) paid to the loads of interesting factual revelations gathered in the course of three years of intense discovery. (For good examples of those, see here, here, here, here, here, here, and here.)

Remember the procedural posture
The parties have filed separate cross-motions for summary judgment. They will each get the chance to file briefs in opposition to the other side's opening brief, and then reply briefs in support of their motions. In other words, though it's tempting to view the two briefs unsealed last week as arguments against each other, they really aren't. In fact, they were filed simultaneously, so they couldn't respond to each other. Both sides made lots of factual accusations and legal arguments. But we have not yet seen direct responses from the other side to any of them. For that, we will need to wait until about May 10, when opposition briefs will be unsealed. Just remember: arguments usually sound their best before the other side has had the chance to tear into them.

It all comes down to specificity
If there's one legal issue that I believe will determine the outcome of the case, it's this: How specific must YouTube's knowledge of infringement be in order for it to fall outside the safe harbor provided by Section 512(c) of the DMCA? In its motion, Viacom provided overwhelming evidence that YouTube knew about infringing videos on its site. Some of this knowledge was general. As YouTube co-founder Steve Chen said in a now-infamous 2005 email to a VC at Sequoia Capital, "you can find truckloads of ... copyrighted content" on YouTube. Viacom Motion at 7. Or, as Chad Hurley emailed, "aaahhh, the site is starting to get out of control with copyrighted material." Id. at 8. But Viacom has evidence of YouTube's knowledge of specific infringements as well. See id. at 25 n. 15 (citing Statement of Undisputed Facts Paras. 32, 59, 69, 105, 110, 116-17, 122, 130, 132, 165). After all, where does one get knowledge of "truckloads" of infringements if not from knowledge of (lots of) specific infringing videos? (YouTube flatly denies that it had knowledge of specific infringing videos. See YouTube Motion at 32.)

So what's the law on specificity of knowledge? Start with the statute. I think there's a common misconception that the DMCA is only about takedown notices, and the knowledge of infringement they impart to the host. That's wrong. Section 512(c) of the DMCA actually identifies two triggers for the obligation of the host to remove the subject material (if it wants to maintain the safe harbor). First is actual knowledge of infringement (which can be obtained through receipt of a facially valid takedown notice pursuant to Section 512(c)(3)). Id. § 512(c)(1)(A)(i). Second is where the host becomes "aware of facts or circumstances from which infringing activity is apparent." Id. § 512(c)(1)(A)(ii). This latter situation is known as "red flag" infringement; the idea is that the host can't claim the safe harbor if red flags are being waved in its face, suggesting the obvious presence of infringing activity. Viacom argues that YouTube had red flag infringement -- in spades:
As the undisputed facts set out above make clear, to say there were red flags everywhere on YouTube is a gross understatement. Defendants were not merely aware of red flags signaling rampant infringement; they rallied around them. Their own documents are contemporaneous admissions that they knew infringing videos generated 54 to 80 percent of the traffic on YouTube that YouTube's business plan intentionally rested on such infringement-driven traffic. This is exactly the kind of intentional guilt the Supreme Court condemned in Grokster. And Grokster liability inherently defeats the DMCA:

inducement liability [under Grokster] and the Digital Millennium Copyright Act safe harbors are inherently contradictory. Inducement liability is based on active bad faith conduct aimed at promoting inhngement; the statutory safe harbors are based on passive good faith conduct aimed at operating a legitimate internet business. Here, as discussed supra, Defendants are liable for inducement [under Grokster]. There is no safe harbor for such conduct.

Fung, slip op. at 43; accord Usenet, 633 F. Supp. 2d at 142 ("if Defendants . . . encouraged or fostered . . . infringement, they would be ineligible for the DMCA's safe harbor provisions").
Viacom Motion at 50-51.

YouTube's argument to the contrary is at 32-38 of its brief. And it bolsters its case with its contention that Viacom's "widespread use use YouTube to market and promote [its] content...defeats any notion that the presence of their material on YouTube creates a fact or circumstance from which infringing activity is apparent." YouTube Motion at 39. Very few cases have probed the boundaries of red flag knowledge of infringement; as far as I'm aware, Columbia v. Fung is the only case where a court has actually found that red flag knowledge existed. On this point, YouTube relies heavily on UMG v. Veoh. Both cases are from the Central District of California; neither is binding on Judge Stanton. Viacom also bolsters its case with reference to Grokster, which it cites for the proposition that the Ninth Circuit's requirement of "specific knowledge of infringement" for inducement liability to attach was "error." Viacom motion at 24-25.

The concession that might win the case for Viacom
For some time, I've been telling anyone who asked me about this case that the biggest obstacle for Viacom isn't the statute or the caselaw. Rather, it's the fact that YouTube has become so wildly popular, and such an established part of the entertainment, social, and political landscape. And relatedly, there are no doubt millions of perfectly non-infringing videos on the site. Given those facts on the ground, it's difficult to imagine any federal district judge saying, in essence, "YouTube is illegal. And I hereby order you to shut it down."

But Viacom gave Judge Stanton an easy out in footnote 1 of its brief. In that footnote, Viacom says it is not pursuing any claim based on YouTube's activities after May 2008, when, according to Viacom, YouTube began filtering for Viacom content without requiring Viacom to license its videos. While Viacom is careful not to formally concede that YouTube's post-May 2008 activities are not infringing, it's effectively letting YouTube off the hook as of that date. I think this was a very smart move on Viacom's part. Given Viacom's concession/limitation of claims, Judge Stanton can now write an opinion that says something like this:
YouTube was once a very bad actor. It had 'truckloads' -- YouTube's word -- of infringing videos on its site. And those trucks flew red flags as they drove right by YouTube's top execs. YouTube knew that its users came to the site largely to view infringing videos. And Google bought YouTube knowing full well about all the infringement, and in fact hoped to profit from it. Therefore, YouTube cannot find safe harbor in Section 512(c) of the DMCA, and must now pay Viacom $734,916,732.18 (which I'm sure Sergey and Larry can find hiding between the cushions of their respective couches).

However, Viacom effectively concedes in footnote 1 of its motion that YouTube cleaned up its act by May 2008, and has indeed taken affirmative steps to cleanse itself of infringements. Therefore, I decline to impose damages for any infringements that occurred after that date, and decline to issue any injunction against YouTube.
That way Judge Stanton could make clear that YouTube may not profit by tolerating infringement, without killing a hugely popular site that has plenty of legitimate uses.


  1. I totally disagree that the issue will come down to the specificity of knowledge that YouTube had. Looking historically at other secondary liability cases, there has never been a case where a plaintiff has demonstrated general knowledge of infringing activity, but that knowledge was rejected. In fact, if you think of Napster, the court described general knowledge of infringing activity. If you think of the flea market cases, both out of CA and NJ, the courts relied on general knowledge. The specificity of knowledge may make a difference in a case where a copyright plaintiff alleges a very limited number of infringements and cannot show specific knowledge. But in a case where the allegation is that there are thousands or tens of thousands of infringements, it cannot be the case that specific knowledge of individual infringements is required. If that were the case, the big time infringer would get off the hook because the infringing activity was so overwhelming that they could not keep track of it.

  2. @Anonymous 4:08:

    But I think the difference in this case is the DMCA defense, which was not available for various reasons in the cases you mention. The degree of knowledge necessary to trigger the obligation to take down infringing material (in order to stay within the safe harbor) is indeed at issue when evaluating whether a DMCA defense is viable.

  3. Another excellent post, Ben

    I find your writing extremely easy to follow (from a non-lawyer's point of view) and fair to both sides (something rarely seen in online copyight-oriented blogs these days).

    As I have said all along, Viacom hired the right legal team here. Excellent. They are making Google's lawyers look like rank amateurs. They are not intimidated by Google as most lawyers are these days. The fact that many of Viacom's orginal attorneys now work for the DOJ will play a significant role here as well.

    There are NO valid arguments against significant liability in this case. In fact, I firmly believe that the founders of both YouTube and Google are hoping that the judge does exactly what you have predicted ... and they can then cut a plea bargain with the DOJ at the exact same time.

    The Statute of Limitations for criminal copyright infringement in this country is five years, you know, not the three years we have to contend with in all of our civil cases. We now have 25 civil lawsuits underway or soon to be filed.

    We simply will not be able to settle these copyight cases fairly until the courts hold Google, YouTube, and other obvious willful infringers guilty under our current copyight laws.

    The penalty MUST be more than the unlawful gain if we want digital piracy to come to a halt, or even reverse its nasty trends.

    We at Imageline simply cannot wait to see this verdict. It is high time we saw some actual "justice" from those who wear the robes.

    Please keep up the excellent reporting, Ben. You are doing us all a huge favor ... and you give us "hope".

    George Riddick

  4. If the judge merely imposes an inconsequential fine, doesn't that create a moral hazard for future startups? "Violate the law however you want, boys, because when we get bought out it's somebody else's problem!"

    Or is that Congress' problem and not something that would rub the judge the wrong way?

  5. Responding to Ben's comment that because of the DMCA defense, there is a higher level of specificity required......

    Sorry Ben. I don't think that is correct. The DMCA was intentionally drafted to mirror the common law standards for contributory and vicarious infringement. The legislative history on this is clear. Accordingly, if Viacom has enough evidence of general knowledge to sustain a contributory claim against Google in the absence of the DMCA, then the presence of the DMCA is not relevant. Apart from the theortetical point, the language of 512(c) is clear that the safeharbor does not apply if there is actual knowledge or if the ISP is aware of facts and circumstances from which the infringement is apparent. Not only do the briefs lay out that there is actual knowledge as to specific Viacom titles, but there is clearly objective knowledge.

    I know I likely sound like a Viacom shill here, which I am not. But, I simply do not understand why Google has not settled this case. Their exposure has got to be massive.

  6. @Anonymous 5:09:

    I don't think you're a "Viacom shill," and Judge Stanton may indeed end up agreeing with you. My point, though, is that in UMG v. Veoh, which Judge Stanton will surely look to, there was general knowledge on Veoh's part of infringement on its site, but the court nonetheless held that the Section 512(c) safe harbor applied. Maybe UMG v. Veoh was wrongly decided, and Judge Stanton is under no obligation to follow it. But as one of the few cases in this area, surely he won't ignore it.

  7. Here is the sad truth for YouTube/Google. There is really no way to disclaim specific knowledge. As with ANY type of media, the most interesting items create disproportionate interest. Clearly the new Britney Spears video or yet to be released on DVD action flick will generate more traffic than the Nth "look how cute the kittie is" video. What is the rational argument to contradict they had the data to point to specific infringement but somehow didnt look at it or act in any way? "The dog ate my stats?" How is it that they were going to sell advertising if they couldnt tell what people were watching?

    I think Viacom can easily show that hits or some other easily identifiable metric would have been able to identify top potential violations. The amount might be de minimis as YouTube claims ... that it would have been quite easily reviewed by humans.

    On the other hand, Viacom is talking smack. They basically want to make every site or service no matter how passive liable to police for their content. Like the DMCA wasn't enough!

    Ben, I agree on the out Viacom left in, I just wish they didn't past it. This could make for some bad case law like "making available".

  8. YouTube is certainly doing its job to stop copyright, why do you all continue to say that they dont.

  9. They still seem to be at it: Using copyright material to promote there own business. I discovered yesterday that a Google Search for - hardman tewkesbury - brings up a geodata rss feed for my flickr account where they offer to overlay the feed into Google maps and Google earth. That feed might have been relevant for a short while 6 weeks ago now clicking it takes you a location in France several 100 miles away, in another country and with no connection to either Hardman or Tewkesbury. Such feeds can only ever be transitory and using them in the way Google has can only be designed to keep people on Google sites and applications. IOW it is using the content to promote its own applications.

    Given the anti-trust investigations going on in Europe regarding Google's self promotion through its search results one would have thought they'd have been a little bit more cautious.


Comments here are moderated. I appreciate substantive comments, whether or not they agree with what I've written. Stay on topic, and be civil. Comments that contain name-calling, personal attacks, or the like will be rejected. If you want to rant about how evil the RIAA and MPAA are, and how entertainment companies' employees and attorneys are bad people, there are plenty of other places for you to go.