Ninth Circuit Bolsters Internet Service Providers’ Defense Against Copyright Infringement Claims

The Ninth Circuit recently bolstered the legal defenses available to Internet service providers in copyright infringement claims based upon users loading copyrighted material on the service provider’s website, in UMG Recordings, Inc. v. Shelter Capital Partners LLC, No. 09-55902, decided on December 20, 2011.  The court rejected the plaintiff’s argument that an Internet service provider is liable for copyright infringement if the service provider uses software processes on its website to facilitate access to the copyrighted material.  The plaintiff attempted to get the court to read the applicable provisions of the copyright statute to limit a statutory safe harbor provision to circumstances where the copyright infringement was based on the service provider’s storage of the infringing material.  Normally, the reason that material is stored on an Internet website is so that it can be accessed via the Internet.  Limiting the statutory safe harbor provisions to only infringement resulting from storage would have resulted in the safe harbor provision being useless for most service providers.

If this decision had gone the other way, it would have had the effect of chilling innovation relating to the variety and quality of services on the Internet.  That is exactly what Congress sought to avoid when it enacted the safe harbor provisions for Internet service providers that were at issue in this case.

In this case, the defendant operates a website that enables users to share videos with other users, and makes money from advertising that appears on the website.  The accused copyright infringer employed various technologies to automatically prevent users from uploading videos containing material that infringed the plaintiff’s copyrights. Whenever the service provider disabled access to a video accused of infringing someone’s copyright, hash filtering software was used to identify identical videos and automatically block any duplicates subsequently submitted by a user.  In addition, audio fingerprints from video files were compared to a database of copyrighted content provided by copyright holders.  If a user attempts to upload a video that matches a fingerprint in the database, the video never becomes available for viewing on the website.  Users have to agree that they will not upload any videos that infringe a copyright before the user is allowed to use the system. A warning message appears on a user’s screen each time the user begins to upload a video stating, “Do not upload videos that infringe copyright.”

The copyright owner argued that the language in the statute should be interpreted to have the same meaning as similar language in the RICO Act.  However, the court pointed out that the RICO statute was interpreted as having a particular meaning based on its particular legislative history, and the Congressional intent underlying the legislation, none of which applied to the copyright statute in question.  In addition, adopting the interpretation urged by the copyright owners would create internal contradictions in the copyright statute.