Red Flag or Bloody Shirt – The MP3Tunes Case

So, what happened this past week is that a jury found that the former owner of a now-defunct music site called MP3Tunes was liable for copyright infringement because he ignored the fact that users were uploading illegal copies to his cyber-locker based site.  Safe harbors contained within existing copyright law are designed to protect website owners from this kind of liability on the grounds that it is, of course, possible for users to upload infringing content without the site owner’s knowledge or permission.  If, however, the site owner(s) can be found to have knowledge, particularly of frequent or high-volume infringement, then they effectively forfeit safe harbor protection and are subject to a liability claim.  That makes sense, and nobody really disputes this premise.  When these cases go to court, what is usually disputed is the idea that a site owner’s knowledge can be proven, and some of the more preposterous clowns in this circus like Kim Dotcom and the owners of The Pirate Bay have been known to say things like, “I don’t know what people do on my site, I’m not responsible for what they do, and anyway file sharing is good.”

According to Jeff John Roberts, writing for GIGAOM.com, the MP3Tunes case signals an important shift in legal precedent that ought to be concerning for internet and technology advocates.    Roberts writes:

“The significance of the case has little to do with MP3Tunes, which has long been closed, but instead stands as a strategic victory for copyright owners. That’s because the jury found Robertson liable on the basis of so-called “red flag” knowledge rather than “actual” knowledge. The distinction may sound arcane, but it’s one the studios have fought hard to establish as part of their strategy to change the level of proof needed to prove piracy.”

The distinction between “actual” knowledge and “red flag” knowledge may have a legal definition, but in this kind of case, it doesn’t sound arcane so much as it sounds childish.  If an owner of an actual website can measure actual traffic and assess quite accurately where that traffic actually goes; and then that actual traffic results in actual dollars in the owner’s actual pocket, I have to assume, as a prospective member of the jury, that the owner in question had what I call knowledge of the kind of files that were making him money.  So, while Roberts seems to suggest this case sets a bad precedent for the rights of site owners who ought to be protected by safe harbors, it looks to me a lot more like common sense is being applied to those site owners who clearly should not be protected.  Nevertheless, Roberts projects some very dire implications of this kind of ruling thus:

“The upshot of all this is that studios, sensing that safe harbors are weaker than they used be, may feel emboldened to go after more sites for alleged infringement. Conversely, weaker safe harbors could make entrepreneurs less willing to experiment with new platforms and technologies.”

There’s that narrative again.  The “studios” are chomping at the bit to go after every little site owner that might be infringing, and this is going to stop “innovation.”  Seriously, with all the money the internet industry has, they might be want to buy a new mantra because this one is getting really boring.  For one thing the “studios” have neither the interest nor the resources to go after the small-scale infringements out there.  Given the scope of piracy worldwide, I think the “studios” would be thrilled to mitigate the problem by some percentage and move on.  Second, after about three years of listening to internet activists tell us people are going to be afraid to innovate, I haven’t heard one legitimate example of a prospective innovation doomed to the dustbin because copyrights are protected and enterprise-scale pirates are prosecuted. Not in editorials, not on blogs, not in testimony before the House Judiciary Committee.  It’s always just some vague reference to innovation in general.  This narrative the industry and its activists keep selling, waving the bloody shirt of the early post-Napster days, has little relevance to the contemporary market, the state of piracy, or current strategies to protect IP rights.

Finally, is it necessarily the case that applying a rationale which logically incriminates someone who is actually guilty of a crime automatically weakens rights for the rest of us? Were safe harbors really weakened here?  I haven’t been to law school, but it sounds like a stretch to me in this case.  Or is this really all about Google?  Roberts rightly points out that Google is a “powerful advocate for safe harbors,” and you bet they are.  With a site the size of YouTube and users uploading videos at a rate of 100 hours every minute, I think it’s a given that company’s executives are going to be firm supporters of the “we didn’t know” defense.  There’s just a little problem in that Google’s mission is to “organize the world’s information,” and the company seems to be pretty damn good at knowing quite a lot about a great many things, including you and me and what we do, say, and see online.  So, if the “we didn’t know” defense is lately springing a few leaks, it’s possible the only “innovators” actually worried about it are a handful of billionaires who run an American company that just might have to clean up its act.

David Newhoff
David is an author, communications professional, and copyright advocate. After more than 20 years providing creative services and consulting in corporate communications, he shifted his attention to law and policy, beginning with advocacy of copyright and the value of creative professionals to America’s economy, core principles, and culture.

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