Facilitator: David Kramer, Wilson Sonsini Goodrich &Rosati
Netcom: OSP couldn’tbe strictly liable for copyright infringement for automated copying/display ofcontent occasioned by users, but contributory liability was available if OSPknew of infringing activity and failed to take action to prevent it, as wasvicarious liability if there was right and ability to control and profit. Congressdescribed Netcom as the leading/mostthoughtful opinion on OSP liability and expressed intent to codify it; JudgeWhyte’s opinion became the charter for the internet age. Netcomhas been the most important/influential copyright decision in the last 30years.
Judge Ronald Whyte, Senior United States District Judge,Northern District of California
Litigants were Scientology/critic; at each other’s throats,which explains some of the litigation issues raised. Did not want to be result-oriented, but hethought about what the proper result should be given the analogy of the copymachine. RTC v. Netcom presented thepure issue of access provision, as compared to bulletin board cases where theoperator was making money from infringement. When Congress cites you, you have to wonder whether it’s like beingaffirmed by the 9th Circuit.
Kramer: did you give any thought to the result if you didn’tdecide that way?
Judge Whyte: Seemed to make everyone liable. Unrealistic.Squelch a lot of activity.
Kramer: still trying to get a handle on what constitutes a “financialbenefit”—since UMG v. Veoh just did more on what constitutes “control” for DMCApurposes.
Jay Monahan, Zynga
1999: not a single case interpreting the DMCA, no litigationpending. First day on the job at eBay (before), other lawyer introduces him toRIAA; MPAA etc. already knew that. Forthe next year and a half, got 5 demand letters/day saying they were going tosue. Most demanded that we make sure no similar items ever appeared again. Survival was the goal; the business modelincluded software, music, movies, books—also TM items, from luxury apparel toeverything else. Right of publicity: celebrity autographs, etc. Content ownersthat came first were copyright owners, and we had extensive talks with all ofthem; they knew the precedents and the law, but said “don’t even think the DMCAapplies to eBay.” They argued that notwithstandingthe language a service provider wasn’t protected. Until Hendrikson,we didn’t have a judicial interpretation saying we were protected by the DMCA.Another thing in that case: the lack of duty to monitor.
Goal at the time: don’t get sued, but certain demands weretotally unscalable, and most far exceeded what the statute required and what hethought a reasonable trier of fact would say was enough. When he responded to copyright & TM, wasalways guided by the principle: I need to be able to explain to a judge so thejudge thinks “I don’t know what the line is, but these guys have gone beyondit, whatever it is.” Played out in Tiffany.
Should we have a notice form? We don’t need one; many sitesjust repeat the DMCA. But administratively, there’s value to having a form.Most people don’t notice that the penalty of perjury language asks you to sayyou have a good faith belief that the work is infringing, not just that yourepresent the rights owner. Alsorequired reporting parties to provide email address/contact info to provide tothe person whose listing was being removed: wanted the disputants to talk toeach other, not to the platform. Virtually every rights owner has found thatnot unreasonable. The DMCA subpoena: anintelligent provision enabling a rightsowner to obtain certain informationabout the user using a special subpoena that doesn’t require a separatelawsuit.
Quickly became apparent that this was a big burden on rightsowners; formerly represented rights owners; tried to make it easy for them.Wanted to provide information to them already provided by the statute (contactinfo).
Monitoring: immunity isn’t conditioned on monitoring. Didn’t want monitoring to be equivalent tocontrol, but we thought that it was the lesser of two evils and we decided tomonitor, despite opening ourselves up to the argument that we therefore hadcontrol of infringement, which Hendrickson then made. Thebeauty of the DMCA was protection against claims by users/sellers as well ascontent owners. We looked for red flags—actualknowledge or facts from which the infringing activity is apparent. When you search yourself, you’re acquiringfacts—we applied an apparent infringement test/something like ablatancy/obviousness test. We didn’t require expertise. Rights owners initially wanted to come downand give us a tutorial on all their products; Tiffany and Rolex wanted to dothe same things. We said: we’ll never do that. That was our line in thesand. There were some weak knees overthat, but I said that if we go down the path of trying to be experts we’vedefeated the whole purpose. Rule: can you look at the four corners of thelisting and see indicia of infringement, then take it down; if those areabsent, rights owners need to report it. If community members say “Pearl Jam never made an album by this name,” Ineed a rights owner to report it.
Suspension: 1 strike, 2, 6 as ISPs now use? Only one case addressed strikes and said 3was sufficient; we tried 2 and evolved a consequence guideline—a matrix ofaction based on infringement. Wanted tobe able to explain who was suspended and who wasn’t in a careful way; never hada problem with that standard. We alsomoved fast.
You have to keep up however you can, even with resourcedisparities—we chose the business model. If you fail to remove expeditiously, you’ve blown it. If you fail tosuspend a repeat offender, you’ve blown it. So we made sure we complied with theminimum, and then eventually developed sophisticated internal tools, includingsoftware, that went beyond that.
Kramer: you said going beyond the DMCA was valuable to showjudges you complied with the DMCA. Does that make a difference? If someone minimally complies, is thatenough, or does it help to show you’ve gone beyond the DMCA?
Whyte: the more reasonable anyone is, the more theyinfluence me. Looking at what’sreasonable under the circumstances. Anyone acting in good faith and goingbeyond the minimum is a plus.
Monahan: primary policing duty is on the IP owner. Tiffany:judge basically excoriated them for stopping reporting altogether at one point,as a protest; he emphasized that the primary responsibility was with the TMowner.
Kramer: with Disney/Zynga hat on: why are content ownersdissatisfied with OCILLA and pushing for SOPA?
Monahan: it’s a lot of work. I’m sympathetic that theinternet has made a difficult product immensely more difficult. They’d love tobe able to shift responsibility to someone else. “Why can’t you just block this/filterthis/use hashtags?” Even the well-intentioned ones wanted to reduce the burdenon themselves. Balancing the need forinnovation/creativity, the DMCA strikes the right balance. Provide immunity with clear rules of thegame, minimum expectations, simple way for content owners to get a remedy 99.9%of the time, when the recipient of the notice takes the stuff down. This caneven be an electronic notice done by an API through a third party service.
Kramer: did eBay have a problem with illicit notices?
Monahan: We did, though not a huge one. Chilling Effectstracks notices; his experience has been that even aggressive rights ownerswanted to do the right thing and not go after fair use; wanted to finddistributors. There are some exceptions to that. He got a letter from areputable law firm. They’d simply searched for every mention of the client’s TMon the site and demanded they all be taken down. He called the lawyer and said “I’m going todo you a favor and not take these down.” Reminded him about 512(f) penalties for false notifications, and saidthat if he insisted on the takedowns eBay would countersue for violation of512(f) and state law unfair competition. Never heard from them again.
The only way this works is if companies occasionally have abackbone and refuse to take stuff down on behalf of their users. He’s spent 6 years fighting to protectcopyrights, but there’s a balance and sometimes only the ISP can stand up forrights. Statute doesn’t require that, but they should do that anyway.
Goldman: what are the implications of doing more than thestatute?
Monahan: risks of raising the bar for yourself, as well asothers. Watch company wanted us to remove listings on the basis of price. Saw where they were coming from, but as soonas you do that, you’ve established a dangerous precedent (and hard toimplement). At the same time, massive piracy is bad for our users. Did that make those doing less unhappy? Yes, but as the larger provider, we drewlines that benefited smaller companies as well.
Fred von Lohmann: was a young associate in 1999, when Yahoowas sued for its auction service by Electronic Arts, Sega, and Nintendo;settled, but one of the first active litigations about the safe harbor.
Are there any perjury prosecutions from the 512 notice? Does that penalty matter? Has any user ever sued a service providerover a facially valid takedown?
Monahan: a few cases over “false reporting.” He’d change the standard to recklessness—rightnow unless you’re essentially defrauding people you have complete protection asa rights complainant. There was one case (Fred’s case) about promo CDs, whenthe rights owners claimed that eBay had to treat promo CDs as infringing. eBay: you can report it and we’ll take itdown, but we won’t consider it blatantly infringing. Eventually the record companies did lose thecase; that was an example of backbone on our part.
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