Category: Intellectual Property

DMCA Review Begins. Watch the Red Flag.

Early last week, the Senate Judiciary Committee held the first in what will be a year-long series of hearings (roughly one per month) to review the Digital Millennium Copyright Act.  Almost as old as the publicly-available internet itself, the 1998 DMCA expressed the best efforts of Congress to predict how the digital market might evolve and to, therefore, strike a balance between the interests of internet service providers (ISPs) and copyright owners.

Over the intervening twenty-two years, much—MUCH—has been written, debated, shouted, flung, wailed, opined, and scorned about the DMCA, specifically Titles I and II of the five-title statute.  If we ask the tech-centric/copyright-skeptics, they are likely to say that Title I (§1201) is a disaster and that Title II (§512) is working just fine; while the creator/copyright proponent will tell us exactly the opposite. I cannot condense the number of issues raised in this first hearing alone into a single post—especially when §1201 and §512 address very different legal regimes—and it is far too early in the review process to respond to any specific proposals being made. 

What I will reiterate in this post is that the greatest concern to creators of every size is the conditional liability shield (“safe harbor”) provided to web platforms by §512.  It is the foundation of the oft-described “whack-a-mole” problem whereby the independent author attempts to remove infringing uses of her works one-by-one, only to have them reappear on the same platform(s) faster than she can prepare new notices.  (And “whack-a-mole” can be just as big a problem for a small business like an apparel maker as it is for a traditional artist like a musician.)  

In response to this futile battle with online infringement, authors often give up enforcement via the DMCA takedown process (resigned to donating even more revenue to billion-dollar corporations) while they ask as a community why the major platforms in particular cannot do a better job of preventing protected works from being chronically re-uploaded without license.  This second question is where we step into a BIG policy kerfuffle with regard to §512, and I imagine it is a topic about which we are going to hear a lot of ideas and a lot of noise.  

This week’s hearing hosted two panels of witnesses, the first of which provided an overview as to how the DMCA came to be; while the second panel, comprising IP academics, provided some insight as to where the DMCA debate may be heading.  In the interest of keeping this post containable, I will focus on the testimonies of Professor Sandra Aistars of the George Mason School of Law and Professor Rebecca Tushnet of Harvard Law School, and the subject of “red flag” knowledge under the DMCA.  

What is “Red Flag” Knowledge?

Unfortunately, you will get different answers depending on whom you ask, including a court split on the matter if you ask either the Second or the Ninth Circuit Court of Appeals.  But in everyday life, “red flag” knowledge is a reasonable, common-sense inference that one can draw from a modest amount of empirical evidence and experience.  If you enter the house to find trash strewn across the floor and a chagrined puppy in the corner, you will not need training in forensic science to have “red flag” knowledge that either the dog has committed a misdemeanor, or he has been artfully framed by the cat.  

That roughly describes the degree of analysis Congress intended ISPs to perform when encountering evidence of copyright infringement on their platforms.  As Professor Aistars noted, “Although Congress did not obligate service providers to actively seek out infringements, it did require them to act expeditiously to remove infringing materials once they have knowledge or awareness of infringing activity on their networks.” (See companion Appendix describing basic ISP Conditions.)

For example, let us imagine that the users of a web platform we’ll call Vimeo are making videos using some famous music we’ll call Beatles songs.  Any ordinary observer can reasonably assume that these users probably did not license these sound recordings; yet in the case Capitol Records v. Vimeo, the Second Circuit held, on the issue of “red flag” knowledge, that the platform’s operators would have needed either legal or music-industry expertise in order to discover infringement.

Keeping in mind that voluntary removal of material based on “red flag” knowledge of infringement is a condition of an ISP’s “safe harbor,” decisions like Vimeo do more than erase this part of the statute—they exacerbate a culture of infringement through court-sanctioned willful blindness.  And as Aistars added in her testimony, “Pointedly, this occurred in a case where discovery had revealed emails from managers to employees winkingly encouraging infringement.”  Thus, Aistars is among those who would advocate clarifying the meaning of “red flag” to restore the intent of §512.

The Vimeo emails Aistars mentions are typical of the shoulder shrugs and middle fingers creators are used to receiving from many platform operators, and application of the DMCA to date has unquestionably fostered cultural attitudes anathema to the kind of cooperation between ISPs and rightsholders Congress specifically intended to promote two decades ago.  Further, unintended endorsement of this culture among site operators may be exacerbating a persistent misunderstanding among individual and commercial users that the internet is a realm of automatic immunity.  As I have described in several posts, this misconception can cause unnecessary trouble for both creators and users of protected works.

Responses to Fixing “Red Flag” 

Anticipating the likelihood that, if there is to be any revision to §512 at all, “red flag” will be a major point of debate, Professor Tushnet warned against what she and others see as throwing out the proverbial baby with the bathwater.  “If there is one message I would ask the members of the Committee to take away today,” she stated in her opening testimony, “it is that most beneficiaries of §512 are not Google or Facebook.”  Tushnet cautions that if we were to amend §512 solely as a response to the challenges creators face on very large, commercial platforms like YouTube, we risk simultaneously putting compliant, smaller platforms out of operation and facilitating even greater monopolization by the largest entities.

As a statistical matter, Tushnet is making a “few bad apples” argument, except for the fact that some of the baddest apples in the bunch happen to be the most powerful, wealthiest internet companies in the world.  So, even if we take her premise and data at face value (i.e. that millions of compliant sites rely on §512 to exist), this does not recommend ignoring the catalog of evidence that application of the DMCA has promoted willful blindness among the operators of major ISPs.  Simply put, if twenty-million sites operate without harm while one site does harm to twenty-million creators, we still have a problem if the law shields that one site from liability.  So, the status quo cannot be the final answer.  

As a practical consideration, Tushnet’s argument is based on the assumption that a more clearly defined restoration of the intent of “red flag” knowledge can only be implemented by technological measures, which only the largest ISPs can afford.  Hence, her argument that this will result in entrenching, for instance, YouTube’s monopoly position, notably glossing over the fact that there are other forces entrenching online monopolies.  While this technology-investment argument is worthy of discussion, the aforementioned Vimeo case is just one example in which the principle of “red flag” knowledge was obliterated in a purely human paradigm (i.e. human managers choosing not to see what was right in front of them).

Post Hoc Ergo Propter Hoc? (or not all good things come from §512.)

As Tushnet testified, her own Organization for Transformative Works site hosts over “four-million works” yielding 1.2 billion page views per month, while the site receives takedown notices at a rate of less than one per month, most of which are invalid.  Assuming these data are correct, the site to which she refers seems barely relevant as an example. It is a large fanfic platform with what appears to be a vast amount of material—mainly short works of written text—that is highly unlikely to infringe.  No sound recordings.  No photographs.  No film clips.  At most, some fanfic writer could maybe—and I mean maybe—run afoul of a derivative works right. 

From a cursory review of OTW, it is not at all evident that adopting a clearer, statutory definition of “red flag” (in order to hold the majors accountable) would force a site like this one to invest in prohibitively expensive technology in order to remain complaint.  If the platform is indeed receiving takedown notices at a rate of less than one valid notice per month, this is most likely evidence that the site hosts little to no infringing material—and that when notices are received, human review is sufficient to the task.  Further, the fact that the site hosts “fandoms” for a long list of works owned by major motion picture studios indicates that infringement must be very low to near zero if it has not invited the attention of an industry with the resources to send notices in volume.  

As is often the case, defenders of the status quo (the same is true for Section 230 of the CDA) will say “look at all the benefits this law has yielded” and then point to examples that, under scrutiny, do not necessarily rely on the liability shield so substantially as may be asserted.  In this vein, Tushnet’s testimony includes several references to all manner of good news about the creative industries—more movies, TV, music, etc. than ever before—but it would be a logical stretch to assert that, for instance, Billie Eilish’s YouTube-to-Grammy-Awards success story owes much at all to §512—let alone the collapse of the “red flag” principle. 

As Chairman Tillis noted, “this is a very wonky subject,” and that last description of mine was very wonky indeed; but DMCA review will be a devil-in-the-details story to watch.  Despite the hyperbole that will inevitably seep onto social media about these hearings, it is neither practical nor desirable for rightsholders to seek obliteration of the safe harbor altogether—that is not the goal.  But at the same time, it cannot be acceptable that a statute designed to mitigate copyright infringement and incentivize cooperation has served to reward infringement and position ISPs and rightsholders at permanent loggerheads.  

*This case is further complicated by a conflict between state and federal law over the use of sound recordings made prior to 1972, but that’s a whole other bowl of noodles. 

Photo source by Robertobinetti70

Appendix I to DMCA 2020: Section 512 “Safe Harbor” Conditions

May people know that online service providers are shielded from liability for copyright infringement by their users, meaning that a court will, on summary judgment, often excuse a web platform as a named defendant when an infringement has been committed by its customers.  Many people are not aware, however, that a service provider must meet certain conditions in order to remain protected by this “safe harbor.”  

These conditions are voluntary, and although failure to meet them does not automatically make a provider liable for infringement; non-compliance will—or is meant to—void the automatic protection in a potential litigation.  Below is a list of several–but not all–of the key conditions a service provider must meet under the DMCA statute Section 512, including an explanation of “red flag” knowledge:

THIRD-PARTY INFRINGEMENT — The infringing material must have been made available by users/customers.  

This is the foundation of 512—the very reasonable assumption by early online service providers (e.g. the Baby Bells) that users will inevitably transmit infringing material online.  If the platforms were held liable for infringement by its users, this would have stifled investment in developing many platforms that host User Generated Content (UGC).  Infringing material may not be made available by a service provider.  If a site operator directly uploads or transmits infringing material of its own volition, the “safe harbor” does not shield it from liability.

NOTICE & TAKEDOWN — The service provider must expeditiously remove infringing material upon receipt of a valid takedown notice sent by the copyright owner or their agent.  

Often simply called notice-and-takedown (or just takedown), sites that wish to maintain the protection of the “safe harbor” generally comply with this provision, though it is a subject of controversy on all sides.  For creators, sending takedown notices, one infringing use at a time, is the source of the “whack-a-mole” complaint.  For ISPs and some users, the takedown regime is often described as rife with abuse and error.  See post here responding to one “abuse” study cited by Professor Tushnet in her testimony at the first DMCA hearing 2020. 

REPEAT INFRINGERS — Develop and maintain a policy that includes account termination as a final step for repeat-infringers.  

This issue made big news when ISP Cox Communications lost two substantial lawsuits for failure to maintain such a policy.  While the DMC does not clearly define “repeat infringer” or dictate the design of a “repeat infringer policy,” it is usually some type scaled warning process (e.g. six-strikes), but which must result in account termination if the repeat infringer refuses to stop.  For instance, the courts found that Cox’s 14-strikes-and-they-will-eventually-reset-your-account process voided their “safe harbor” in court. 

KNOWLEDGE — Site operators are not required to search for infringement, but they must remove material upon obtaining knowledge that it is infringing.   

Because the knowledge conditions have largely been ignored in practice over the past 22 years, many people do not know they exist or what they are.  Codified in 512(c), the statute expressly states that the service provider “shall not be liable” if (1) its operators do not have actual knowledge of infringement; (2) its operators are not aware of facts or circumstances from which infringing activity is apparent; and (3) upon obtaining knowledge of infringement, expeditiously removes the relevant material.  

That second condition describing “facts or circumstances” is what we often refer to as “red flag” knowledge under the DMCA.  This is the “walks like a duck,” common-sense knowledge standard that has generally been erased from practice.  For instance, many cases and complaints involve famous works used in ways that any layperson could assume is unlicensed; or several famous litigations have found evidence of internal communications indicating that site operators had a pretty good idea that infringement was taking place. 

With Friends Like Wyden … Creators Have a Problem

Sen. Wyden Town Hall, Newberg, OR

Anyone who is consistently engaged on copyright issues is used to hearing the rhetoric from the major critics, who say things like We support creators while they advocate policies that will further erode authorial rights.  Whether these parties engage in this kind of chicanery in order to sacrifice artists at the altar of Big Tech, or they do it just because they are petty iconoclasts is subject to a case-by-case consideration.  But when that same I care about you message is delivered by a senator to his constituents, it is acutely disappointing when he returns to the cloister of Washington D.C. and totally screws them over.  

The fact that Senator Ron Wyden was going to do exactly this to Oregon’s creative community is prefaced in at least two town hall meetings captured on videos I have seen.  In one of these clips (which has not been made public), Portland-based photographer Tim Trautmann asks the senator about releasing his one-man hold on the CASE Act.  After assuring the artists, musicians, photographers et al in attendance that he is “very sympathetic” to the need for a small-claim copyright option, Wyden then patronizes his constituents in a rather cloying display in the political art of hokum.  First, by alluding to a mostly-false narrative in which he negotiated the amendments necessary to pass the Music Modernization Act (2018), Wyden then cites this unearned credential to imply that he will likewise help shepherd the CASE Act to passage with a few minor amendments that he personally believes are necessary.

From there, the senator rather predictably aped the tech-industry talking point that “teenagers and grandmothers posting memes could be harmed” by the small-claim copyright process, lapsing into cringy rhetoric, telling the “good people” in the room that he knows they do not want to hurt teenagers and grandmothers.  In a similar video clip captured at Newberg by Trautmann, Wyden does the “grandmothers and teens” spiel along with other familiar, industry talking points, including the fallacious assertion that the small-claim tribunal would provide fresh opportunity for copyright trolls to ply their dark arts. 

I believe the professional, political-operative’s term for Senator Wyden’s response to this group of Oregon voters is known as Absolute Bullshit, which is an official grade above Mostly Bullshit.   The higher rating is earned in this case because, for example, the senator framed his allegedly unique perspectives about the CASE Act “in its present form,” as though the bill were still embryonic and not thoroughly developed by multiple parties over several years.  

Presumably the good people in those rooms know that Senator Wyden can read the bill and at least acknowledge its many safeguards designed to alleviate the very concerns the senator pretends that he alone is now raising.  Not the least of these would be the mandate that the small-claim tribunal is VOLUNTARY.  (On the other hand, given the number of times the senator referred to his notes in the meeting captured in Trautmann’s video, I wonder if he did read the bill or understands how it works.)

So, after blowing all that smoke around various rooms in the state, Senator Wyden returned to D.C. and asked for changes to the CASE Act that would effectively obliterate its whole purpose for existing—a.k.a. poisoned pills.  For instance, his proposal to reduce the damages caps by 95% of their current level is not only too extreme a revision to call a “compromise,” but it shows the senator’s underlying contempt for the bill, for copyright in general, and, by extension, for those constituents he basically blew off in the town hall meetings.  A damages cap as low as $750 for a single claim (Wyden’s proposal) is so low that it barely covers the cost of filing the complaint and is, consequently, no deterrent to the kind of real-world infringements most rights holders have a problem addressing. 

A Small-Claim Option is Good for All Parties

On a phone call with several Oregon creators, another Portland-based commercial photographer, Michael Shay, relayed an anecdote about Trautmann that is exemplary of the conflicts the CASE Act was written to resolve.  After a local restaurant used one of Trautmann’s images without permission on its website for promotional purposes, the photographer requested a very reasonable few hundred dollars for the continued commercial use of the photo.  “When the restaurant did not respond to letters and phone calls from his lawyer,” says Shay, “Trautmann expressed frustration about the situation to friends on social media, and that led to resolving the issue.” 

I know.  We can almost hear the chorus of tech-utopians exalting the use of social media pressure as a form of enlightened, DIY justice.  But as Shay observed, social media “shaming” (i.e. a public fight) is not a very healthy solution for anybody involved—neither the copyright owner nor the infringing user—least of all in a relatively small community like Portland.  On the contrary, civil laws exist in part to keep society from devolving to tribes of bullies; and very few copyright owners want to resort to bullying just so they can be fairly compensated for the use of their works.  “I very reluctantly went to social media to talk about this issue at all,” Trautmann later told me.  “I confided my feelings to one friend on Facebook, who then wrote a scathing review of the restaurant on Yelp!, and that resulted in settlement of the infringement matter.” 

So, as indicated in my last post on this topic, Senator Wyden might want to look beyond his personal biases about copyright and the CASE Act and take a more holistic view of the community he was elected to serve.  A copyright small-claim board is a civilized, voluntary (did I mention voluntary?) solution to a conflict between two members of a community—the copyright owner and the average commercial infringer like that restaurant—not the least consideration being that the restaurant would lose big in a federal case, if Trautmann had to file a lawsuit.  Senator Wyden might want to ask the owner of Washington, D.C.’s Violent Hues productions what it ultimately cost him to post a photo on a website that he “found on the internet,” and whether a small-claim board would have been a much better venue. 

It is a cold reality of politics that an elected official may be able to gauge the extent to which he can piss off some segment of the electorate.  For instance, a Democrat can push environmentalists pretty far on the assumption that (at least in the present climate) that constituency is unlikely to swing to a Republican opponent.  A similar calculus may be a factor for Senator Wyden sizing up much of Oregon’s creative community—an assumption that they are mostly “safe votes” in our current electoral dynamics.  On the other hand, when a representative so blatantly misleads and blithely dismisses a community, as Wyden did in these town halls, he may discover that he is more vulnerable than he thinks.  After all, with friends like him in Congress ….

Video link and still courtesy of Tim Trautmann.