A Legal Blog by Aaron | Sanders, PLLC

Burning Down the Dance-Hall: UMG v. Veoh Clarifies the DMCA

One of the Great Unanswered Questions Is Answered!

This is the third post on the recent and important Ninth Circuit opinion in the “Veoh case” (actually styled, UMG Recordings v. Shelter Capital, but we’ll call it “Veoh”). In the first post, we marveled at Universal’s surprising leading argument and worried about the fate of user-created videos of cute kittens. In the last post, we analyzed Universal’s surprisingly weak argument that Veoh had “red flag” knowledge of infringing activity and wondered if Universal hadn’t made things worse for rights holders on that issue.

Universal’s third and final argument fares rather better*, although it, too, ultimately fails. It targeted the financial benefit requirement (which, remember, is really a “no financial benefit” requirement). Recall that there are two prongs to this requirement: (1) the provider not receive a “financial benefit directly attributable to the infringing activity”; and (2) the provider have “the right and ability to control” the infringing activity.

* I still think that Universal would have been better off targeting Veoh’s repeat infringer policy. There’s so much we just don’t know about this requirement. Universal would have had a much better shot at reshaping the law in rights-holders’ favor, and at…

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UMG Swings for the Copyright Fences … And Misses Everything

Ninth Circuit: It’s OK to Let the Public Access User-Uploaded Content

I think by now you’ve read a few headlines about Ninth Circuit’s decision in UMG Recordings v. Shelter Capital, which is better known as the “Veoh case,” just before Christmas. Mostly, the headlines say something like: Veoh Dodges Universal Music’s Copyright Claims, or Universal Loses DMCA Lawsuit Against Veoh.

But when you read the opinion, you should be struck by two things that have nothing to do with Veoh. First, Universal Music wasn’t just trying to get some compensation from a specific video site–it was trying to put video sites out of business. There’s no other way to explain the strategic choices Universal Music made. Second, as a result, in part, of Universal Music’s choices, the Ninth Circuit has just made Viacom’s life a lot harder for its case against YouTube.

Understanding Universal’s Peculiar Legal Strategy

If you’ve been reading my blogs on the DMCA defense (mostly in connection with the Nashville lawsuit against Grooveshark), you know that, even after 12 years, there are several very basic unanswered questions about DMCA safe-harbor protection. Off the top of my head, the most significant are:

What does it mean to have actual knowledge of infringement,…

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In Grooveshark’s Defense: DMCA Safe-Harbor Protection (Part 6 of Online Music Service Series)

Is Grooveshark Just the YouTube of Music?

Although Grooveshark has been sued now three times, it has not yet had to explain why it thinks its activities are legal.  After all, as we explained in our last two posts, its activities are infringing–but surely Grooveshark’s founders haven’t gone to the trouble of starting a business if they didn’t have some legal basis for what it does.  And, indeed, they do: they believe Grooveshark is the YouTube of music.  The idea is that, just like YouTube, users upload content and stream that content to their computers on request.  And, to the same extent what YouTube does is legal, so should be what Grooveshark does.

By its nature, YouTube is always at risk of committing both direct and secondary copyright infringement.  Any time a user uploads a copyrighted work–from clips ripped directly from TV or DVDs to home-made videos of children dancing to Prince songs–YouTube would be subject to secondary liability.  Any time a user streams such content to his or her computer, YouTube would be subject to secondary liability.

I say “would be” instead of “is” because YouTube isn’t* liable for these many instances of copyright infringement.  YouTube has a defense:  section 512…

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