Court Finds that File-Sharing Site Can Be Entitled to DMCA Safe Harbor

Court Finds that File-Sharing Site Can Be Entitled to DMCA Safe Harbor

In another case involving, a federal judge has again rebuffed an attempt by a copyright-holder to claim that the safe harbors of the Digital Millennium Copyright Act (DMCA, 17 U.S.C. § 512) do not protect the video file-sharing site.UMG Recordings, Inc. v. Veoh Networks, Inc., 2008 WL 5423841 (C.D. Cal. 2008).

The Veoh website includes videos supplied by Veoh’s content partners and permits visitors to access large library of commercial television shows and movies. Veoh also permits users to upload their own video content. While Veoh has policies against uploading copyrighted material, copyright holders have alleged that users can, at least temporarily, circumvent Veoh’s measures — with the result that copyrighted music and videos are distributed to other users.

In response to suits from such copyright holders, Veoh has claimed qualified immunity under the DMCA. The DMCA, provides several safe harbors for digital media service providers, including limited immunity for infringing information “residing on systems or networks at direction of users.” (fn1)

In UMG Recordings v. Veoh, copyright holder UMG Recordings, Inc. claimed that Veoh cannot take advantage of this safe harbor because Veoh performs several functions on user-uploaded videos that are not “storage” and are not “undertaken at the direction of a user.” (fn2) These included: (1) creating “Flash-formatted” copies of the uploaded videos; (2) creating “chunked” versions of the uploaded videos; (3) allowing users to access videos via streaming; and (4) allowing users to download whole video files.

In his December 28, 2008 ruling, the judge started with the key assumption that all the activities cited by UMG amounted to “software functions directed toward facilitating access to materials stored at the direction of users.” (fn3) Then, focusing on the precise wording of the DMCA, the judge noted that the provision of the DMCA in question — 17 USC §512(c) — doesn’t state that safe harbor protection is only available for “storing” information. Rather Section 512(c) states that limited immunity is available for infringement “by reason of” or “as a result of” such storage. The judge stated that “when copyrighted material is displayed or distributed on Veoh, it is ‘as a result of’ or ‘attributable to’ the fact that users uploaded the content to Veoh’s servers.” (fn4)