Trademark & Copyright Law Blog : Intellectual Property Lawyers & Attorneys : Foley Hoag Law Firm : Washington D.C., Boston

In what must be one of the nation’s longest-lived Internet copyright wars, Perfect10, Inc. recently opened up a new front, asserting that online publication of its Digital Millenium Copyright Act takedown notices is a copyright violation.

Perfect10, founded by former mathematics professor and professional poker player Norman Zada, is a softporn fee-based Internet site and print magazine that publishes pictures of women in various states of undress. Although Perfect10 tries to reserve these pictures exclusively for its customers, the images have a way of getting around, and are often republished online without authorization.

And how does one find these pirated images? Well, Google, of course! For example, a search for the model Amy Weber (pictured left in a page from the District Court’s opinion) in Google Image Search will retrieve automatically indexed thumbnails of a variety of pictures of Ms. Weber that derive from and link to websites which may or may not have the right to display them.

Beginning in 2001, Perfect10 began sending takedown notices to Google pursuant to the DMCA, insisting that Google cease and desist promoting the pirate sites by indexing and linking to these images. Although Google did remove many infringing images from its search results, Perfect10 was dissatisfied with what it viewed as a less-than-perfect response, and sued Google in the Federal District Court for the Central District of California. Perfect 10 alleged that a variety of activities by Google, including the thumbnail indexes and in-line links to the pirate websites, were both direct and secondary infringements of Perfect10’s display and distribution rights.

After Perfect10 appealed the denial of a preliminary injunction, the Ninth Circuit held that the thumbnails, although otherwise meeting the elements of direct infringement, were nonetheless highly transformative fair use and, because they were small, did not harm Perfect 10’s market for high-resolution images. However, the Court remanded the matter to determine whether Google might be liable for contributory or vicarious infringement. Thus, nearly 10 years and a thousand docket entries after the first takedown notice, the case is still going strong.

Enter Chilling Effects, a non-profit educational project run jointly by the Electronic Frontier Foundation and an impressive collection of law schools. Chilling Effects invites the public to submit takedown notices, after which they are posted, commented upon by the public and studied by legal scholars. Google, being the netizen that it is, had been dutifully forwarding all of Perfect10’s takedown notices to Chilling Effects. Then, in place of the removed images, Google included a link to the takedown notice with a statement that said:

“In response to a complaint we received under the US Digital Millennium Copyright Act, we have removed 1 result(s) from this page. If you wish, you may read the DMCA complaint that caused the removal(s) at ChillingEffects.org.”

So what’s the problem? Well, in an apparent effort to be crystal clear about which pictures it did not want displayed for free, Perfect10’s takedown notices had included copies of those pictures. So, even after Google stopped displaying small thumbnails or linking to possibly low resolution pirated versions of these images, it was still linking directly to those same images on chillingeffects.com. These versions of the images, however, because they were provided directly by Perfect10 itself, were in many cases full-size and in high-resolution. In other words, they were a perfect free replacement for the very pictures Perfect10 had been trying control and sell.

Perfect10 moved once again for a preliminary injunction, this time to prevent further forwarding of its takedown notices, which it argued constituted both direct and contributory infringement. The Central District Court disagreed, and held that the posting of the images in the context of legal study was fair use, and required the full take down notices, pictures and all. Perfect10, which time after time has shown itself to be resilient in the face of defeat, predictably has appealed to the Ninth Circuit. Last month, the Electronic Frontier Foundation submitted an amicus brief, and has also made the all briefs available on its website. Oral argument has yet to be scheduled.

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Almost since the founding of YouTube in 2005, the on-line video service has been labeled by commentators as a top virtual destination for copyright-infringing material. According to a lawsuit brought by Viacom International, Inc., YouTube was aware of this alleged infringement as a general matter, and through advertising revenues profited handsomely from it. Nevertheless, a federal judge has held that YouTube’s general knowledge alone, without information about specific instances of infringement, was not enough to forfeit the protection of the Digital Millennium Copyright Act (“DMCA”).

The DMCA, as codified at 17 U.S.C. § 512(c), provides an internet service provider (“ISP”) with “safe harbor” protection against copyright infringement suits under certain conditions. If somebody uses the ISP’s service to store infringing material, the ISP is protected if it does not have actual or constructive knowledge of the infringement, and if it acts quickly to remove such material once it does have knowledge of it. Also, the ISP must not receive a financial benefit directly attributable to infringing activity that it has the “right and ability to control.”

When YouTube did receive notice of specific infringing material, it acted quickly. In February 2007, Viacom sent a mammoth take-down notice to YouTube, naming about 100,000 specific clips. Those clips were removed nearly overnight. However, Viacom alleged that YouTube did little, if anything, to locate and remove potentially infringing material on its own, even though it generally knew that such material existed. In March 2007, Viacom sued YouTube, claiming that this general knowledge gave rise to liability for copyright infringement. YouTube moved for summary judgment, asserting entitlement to safe harbor under the DMCA.

On June 23, 2010 Judge Louis L. Stanton, federal District Court Judge for the Southern District of New York, issued an opinion and order agreeing with YouTube. It was not enough that YouTube was generally aware of, and even welcomed, copyright-infringing material on its website. Rather, in order to lose safe harbor protection, YouTube had to have had knowledge of specific infringing materials, and sufficient information (such as the URL address) to locate and take down those materials. Additionally, Judge Stanton held that, even if YouTube directly profited, it could not be charged with “the right and ability to control” the infringing activity until it had that specific knowledge.

Consistent with the language of 17 U.S.C. § 512(m), Judge Stanton’s ruling puts the burden of on-line policing squarely, and solely, on the copyright holder. An ISP, by contrast, has essentially no duty to determine the copyright ownership of the material it is storing, no matter how prevalent infringement may be, and no matter how much money is gained from that infringement.

Viacom plans to appeal to the Second Circuit which, interestingly enough, recently encountered similar policing issues, albeit unrelated to the DMCA, in Tiffany (NJ), Inc. v. eBay Inc. In that case, in a decision that may foreshadow an appellate defeat for Viacom, the Court held that even though eBay may have known in a very general sense that its website facilitated sales of counterfeit Tiffany products, such general knowledge alone was not sufficient to establish trademark infringement.

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