Tuesday, September 15, 2009
Judge Tosses Copyright Infringement Suit Against Veoh
By STEVEN M. ELLIS, Staff Writer
A federal judge has thrown out Universal Music Group’s copyright infringement suit against online video-sharing service Veoh.
U.S. District Judge A. Howard Matz of the Central District of California held Friday that San Diego-based Veoh satisfied all of the requirements necessary to preclude monetary or injunctive relief under the Digital Millennium Copyright Act’s “safe harbor” provisions.
Awarding Veoh summary judgment, Matz said there were no material factual questions because the company lacked actual knowledge of infringement, received no direct financial benefit from infringing activity and expeditiously removed or disabled access to infringing material upon notice.
The judge ruled in December that Veoh could argue that the safe harbor provisions’ prohibition on holding service providers liable for infringement “by reason of the storage at the direction of a user” applied to the methods by which the company delivered content to users.
Veoh allows Internet users to view and share videos with others, free of charge, via its website and a standalone software application. Like many companies that have developed such services in recent years, it describes its software as a means for democratizing the distribution of user-generated content. The company currently has over a million videos available for viewing.
UMG—an umbrella group representing a number of record labels—filed suit in 2007 alleging that Veoh benefited from, and was liable for, infringement of UMG’s copyrights. The company sued both Veoh and Veoh’s investors for direct, contributory, and vicarious copyright infringement, and for inducement of copyright infringement.
When Veoh asserted an affirmative defense under the safe harbor provisions, UMG moved for partial summary judgment that Veoh was not entitled to do so under 17 U.S.C. § 512(c).
Eligible for Protection
Matz said in his December ruling that Veoh’s use of certain formats to create copies of user-uploaded videos and deliver them to users was eligible for protection, but said then that his decision had no bearing on whether Veoh satisfied the safe harbor’s other requirements.
UMG resisted Veoh’s subsequent motion for summary judgment, arguing that there were issues of fact whether Veoh expeditiously removed infringing material when it acquired actual knowledge of such material or awareness of facts from which infringing activity was apparent.
The group further contended that factual issues existed as to whether Veoh received a direct financial benefit from allegedly infringing activity it had the right and ability to control, and whether Veoh adopted and reasonably implemented a policy of terminating repeat infringers.
Addressing UMG’s first argument, Matz noted that the Ninth U.S. Circuit Court of Appeals concluded in Perfect 10, Inc. v. CCBill LLC (2007) 488 F.3d 1102 “that the burden is on the copyright holder to provide notice of allegedly infringing material, and that it takes willful ignorance of readily apparent infringement to find a ‘red flag.’ ”
The judge then concluded that the “right and ability to control” necessary to expose an Internet service provider to liability was greater than the threshold level required simply to qualify for the Sec. 512(c) safe harbor, and he rejected UMG’s contention that Veoh’s policy of not automatically terminating users who uploaded videos that were blocked by an automated filter was inadequate.
Pointing out that the filter—known as Audible Magic—compares uploaded videos to a song database compiled from information collected by copyright holders, Matz wrote that “Veoh has no way of verifying the accuracy of Audible Magic’s database, and even if it did, it would be unreasonable to place that burden on Veoh.”
The case is UMG Recordings, Inc. v. Veoh Networks, Inc., 07-5744.
Copyright 2009, Metropolitan News Company