On April 5, 2012, the Second Circuit Court of Appeals issued its long-anticipated ruling in Viacom International Inc., et al. v. YouTube, Inc. The case has implications for companies with websites that permit the posting of user-generated content or third-party content and may impact a defense to copyright infringement under the Digital Millennium Copyright Act’s (DMCA) “safe harbor” provisions.
The District Court, in June 2010, held that even though a jury could find YouTube was generally aware of the uploading of infringing content to its website, it had no liability for infringement because it had designated an agent for the receiving of take-down notices and the swift removal of the infringing content upon receipt of the notices. The court stated that to find YouTube liable, Viacom would have to show YouTube had actual knowledge that a particular clip was infringing; it was not enough to have general knowledge that infringing content was present on the site.
The Second Circuit, on appeal, affirmed in part and reversed in part the district court’s ruling. While the Second Circuit affirmed the district court’s finding that the DMCA requires actual knowledge of specific infringing activity, it remanded the case because it found that a reasonable juror could reasonably find YouTube did, in fact, have such specific knowledge. Ruling that the willful blindness doctrine could be applied in certain situations under the DMCA, the court further remanded to determine whether YouTube was “willfully blind” to infringing activity on its site. Finally, while the court affirmed the district court’s holding that the “right and ability to control” infringing activity requires item-specific knowledge, it remanded the issue for further fact finding, despite the court’s reluctance to articulate the level of knowledge that would be needed to find the requisite control.
While additional appeals in the Second Circuit appear likely, the Second Circuit’s ruling, at this time, emphasizes the increased need for online service providers to be proactive in complying with the DMCA (e.g., acting on specific facts that may be obvious signals of copyright infringement), rather than just waiting to receive a takedown notice. It also shows that it will be more difficult for online service providers to prevail on a motion for summary judgment in cases involving the DMCA’s safe harbor provisions. Online service providers and content owners will definitely be watching how this case continues to develop.