In Viacom Int'l, Inc. v. YouTube, Inc. [enhanced version available to lexis.com subscribers], the Second Circuit interpreted the safe harbor provisions of the DMCA that limit the liability of ISPs for storing infringing material at the direction of users. The decision adopts a broad interpretation of "storage" and an interpretation of "red flag" awareness that favors ISPs. However, the court's analysis of the "right and ability to control" infringing activity is somewhat more favorable to copyright owners than the approach recently adopted by the Ninth Circuit. In this Analysis, Mary LaFrance discusses these decisions and their legal implications. She writes:
I. Background In the Digital Millenium Copyright Act of 1998, Congress created a series of statutory safe harbors - codified at 17 U.S.C. § 512 -- to limit the liability of Internet service providers (ISPs) for copyright infringement arising from the activities of their users or from the content of websites accessible through their services. To qualify for one of these safe harbors, a defendant must be a "service provider" within the meaning of § 512(k)(1)(B), must satisfy the general conditions of § 512(i), and must also satisfy the specific conditions of the particular safe harbor it seeks to invoke. In Viacom, the safe harbor at issue was § 512(c), which applies to "storage [of copyrighted material] at the direction of a user." 17 U.S.C. § 512(c)(1). To qualify for this safe harbor, the ISP must not know that the material being stored is infringing, or must remove or disable access to it promptly upon learning that it infringes. In addition, the ISP must not derive a financial benefit from an infringing activity that it has the right and ability to control. During the years in question, YouTube removed infringing material stored on its site whenever that material was specifically identified in "take-down" notices sent by copyright owners. However, YouTube also left a large quantity of infringing material in place when that material had not been the subject of specific take-down notices.II. Second Circuit's AnalysisA. "Red Flag" Awareness: § 512(c)(1)(A)(ii) One of the crucial questions in Viacom was what kind of knowledge triggers the obligation to remove or disable access to infringing materials stored at the direction of users. In the words of the statute, the § 512(c) safe harbor for storage applies only if the ISP:
(i) does not have actual knowledge that the material or an activity using the material on the system or network is infringing;(ii) in the absence of such actual knowledge, is not aware of facts or circumstances from which infringing activity is apparent; or(iii) upon obtaining such knowledge or awareness, acts expeditiously to remove, or disable access to, the material . . .
17 U.S.C. § 512(c)(1)(A). Clause (ii) is commonly referred to as the "red flag" provision.
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