Viacom v Youtube Decision – Not as Bad as All That

The Second Circuit has finally released its long-awaited decision in the appeal of the Viacom v. Youtube lawsuit, about which I’ve blogged a great deal [starting here, here, here, and here]  over the past couple of years.  Viacom “won” — in that they got the reversal of the district court’s comprehensive judgment in YouTube’s favor — but notwithstanding the considerable hand-wringing already underway about how terrible a result this is, I’m here to tell you:  It ain’t so bad.  In fact, I think it’s a pretty sensible opinion that clarifies the law surrounding service provider immunity in some very helpful ways and, most importantly, does no significant damage at all to the underlying immunity principles that have been so profoundly important for the development of the Net over the past decade.

Here are some of the key points.   [my emphasis throughout] [My apologies if you're unfamiliar with the basic layout of the case -- see the above links for the basic background]

1. “[A] finding of safe harbor application necessarily protects a defendant from all affirmative claims for monetary relief.”

That’s good — Viacom and allies had argued that the 512 immunities don’t cover any claims for contributory infringement, vicarious infringement, or inducement of infringement.  It was an odd theory, and the court shoots it down, correctly, in no uncertain terms.
2.  “[T]he ‘right and ability to control’ infringing activity under § 512(c)(1)(B) requires something more than the ability to remove or block access to materials posted on a service provider’s website.”

That’s good, too.  The statute says a service provider is not immune from claims if it has the “right and ability to control” the infringing conduct (and derives a “financial benefit” from the infringements).  Viacom advanced a plausible argument that, because YouTube (and virtually all content-hosting sites, including the Volokh conspiracy) can throw people off the site if they violate the terms of service, or because they have the technical capability to delete individual postings, that that constitutes a “right and ability to control” the infringements.  This interpretation would have gutted the 512 protections and, again, the court strikes it down.

3.  The court makes it clear that “the basic operation of § 512(c) requires knowledge or awareness of specific infringing activity.”

This is a really important holding, and a really good one.  The battle over service provider copyright infringement liability (including this lawsuit) has always been focused on one central question:  Given that everyone with a brain in his/her head knows that there’s infringing material out there, who has the duty to uncover it?  And when does that duty arise?

Ever since the Napster decision back in 2001 (another decision that most people, incorrectly, viewed as a big win for the content providers), courts have consistently held:  the burden is squarely on the copyright holders, not the service providers.  If copyright holders identify specific infringing files (and give the service provider notice of where those files are located), the service provider “retains safe-harbor protection if it ‘acts expeditiously to remove, or disable access to, the material.’ ”   But the service provider – even if it has “generalized knowledge” that there’s infringing content on its site — need not take any affirmative steps to find that material and remove it without notice from the copyright holders.

The court reaffims this in no uncertain terms.

“[A service] provider that gains knowledge or awareness of infringing activity retains safe-harbor protection if it ‘acts expeditiously to remove, or disable access to, the material.’  Thus, the nature of the removal obligation itself contemplates knowledge or awareness of specific infringing material, because expeditious removal is possible only if the service provider knows with particularity which items to remove.”

This is a strong affirmation of what I regard as the key component to the whole 512 safe-harbor:  the “knowledge” that disqualifies a service provider from the safe-harbor is knowledge that file X, residing on the service at specific location Y, is infringing; and the service provider has no duty to monitor to find those files.  (“ DMCA  safe  harbor  protection
cannot be conditioned on affirmative monitoring by a service provider.”)

So what did Viacom get out of all this?  The court reverses and remands for the district court to consider 2 things:  First, taking Viacom’s factual allegations as true (because the district court had granted summary judgment for YouTube), there’s evidence in the record that YouTube had, at least with respect to some specifically identified postings, “actual knowledge” that those were infringing.  And second, the court articulates a “willful blindness” exception to the safe-harbor:  if YouTube’s lack of “actual knowledge” of “specific infringing files” was due to their own acts of “willful blindness” — a “deliberate effort to avoid [obtaining] guilty knowledge” — they can’t assert the immunity.

We’ll see how that last one plays out.  The devil, as always, is in the details.  An overly-expansive definition of what constitutes “willful blindness” could lead to trouble – but I am pretty optimistic that courts will be able to define it in such a way that it disqualifies only truly egregious conduct (and that service providers will, as a consequence, be less likely to engage in egregious conduct) while placing a high enough bar in the way of those trying to prove the egregiousness of the conduct that it only gets the really bad actors and leaves the vast majority of service providers unaffected.