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Thursday, May 20, 2010

Takedowns and Daiquiris: Viacom v. YouTube Hosts a Grokster Reunion
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The genuinely tragic case Viacom v. YouTube is now hosting a new amicus brief filed "in Support of the Defendants." In it, familiar arguments made by familiar amici illuminate both the illegality and the immorality of what can be called the "takedowns-and-daiquiris" interpretation of the "hosting-service safe harbor" enacted in § 512(c) of the Digital Millennium Copyright Act, (the "DMCA").

In effect, this "takedowns-and-daiquiris" interpretation of § 512 attempts to abrogate the Supreme Court's unanimous decision in MGM Studios Inc. v. Grokster Ltd., 545 U.S. 913 (2005). Again, its advocates interpret another federal law to grant a "safe harbor" to online service providers who intend to profit by letting unsophisticated consumers assume potentially ruinous direct liability for the millions of infringing acts required to build an Internet business based upon mass piracy.

Below, I explain why these efforts to imagine that the DMCA overturns or limits Grokster should fail just as miserably as the defense of the indefensible Grokster Defendants.

Once Grokster reached the Supreme Court, the Defendants—the distributors of the file-sharing programs Grokster and Morpheus—foreclosed any principled defense of their conduct when their justified fear of "criminal investigation" barred any potential amici from reviewing the record to see what they had actually done. As a result, the Grokster Defendants could be defended only by amici willing to blindly defend all criminal conduct that the Grokster Defendants might be concealing.

Nevertheless, in Grokster, over 100 academics and scores of "public interest" groups still rushed blindly to the defense of the Defendants' blatant commercial piracy schemes. Wailing vaguely about "innovation" and "chilling effects," these pro-Grokster amici thus demanded that the Supreme Court's 1984 5-to-4 decision in Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417 (1984) ("Sony") grant a "safe harbor" even to criminals intentionally creating the largest global for-profit copyright-piracy syndicates then known. Naturally, the Supreme Court unanimously rejected such histrionics. Indeed, during oral argument, the Defendants' expert counsel could only stammer as Justice Kennedy eviscerated contrive wailing about "innovation":

After their unanimous defeat in Grokster, "public interest" groups that had long posed themselves as thoughtful advocates of "balanced" copyright protection were thus revealed for what they always were—ditzy cheerleaders for even the Internet's most blatantly inefficient for-profit corporate piracy schemes.

But recently, a threat arose to the Grokster amici's status as the Internet's most unprincipled cheerleaders-for-piracy. In Viacom v. YouTube, the parties' summary-judgment briefs revealed that another crew of would-be Internet pirate kings—the original founders and employees of the YouTube website—had compiled evidence of their malign intent to facilitate and exploit pervasive piracy seemingly worse than even the evidence of intent that the Grokster Court held to be "clear," "replete," "unmistakable," and "overwhelming."

Naturally, an amicus brief defending the original YouTube founders soon appeared in Viacom v. YouTube. It was filed by an array of "public-interest" groups that could not await the close of briefing before again leaping blindly to the defense of seemingly deliberate corporate piracy. Predictably, its signatories consisted almost entirely of the most radical of the blind defenders of the deliberate piracy in Grokster.

For example, the too-radical-even-for-Grokster gang at Public Knowledge signed the Viacom amicus brief. So did the technologically oblivious Morpheus fans at the Electronic Frontier Foundation. The Home Recording Rights Coalition also insisted that Sony "harbored" even blatant and deliberate piracy. And who can forget the vicious, sue-families-and-prosecute-students rhetoric of narcissistic consumer-haters like the Internet Archive, the American Library Association, and the Association of Research Libraries?

How telling that only these most extreme defenders of Grokster and Morpheus would blindly rush—yet again—to the defense of the seemingly deliberate wrongdoing of the founders of the original YouTube—the "video Grokster."

The amicus brief these groups filed in Viacom v. YouTube can thus be called the brief of the "Grokster Defenders." Again, it conjoins inane arguments with familiar histrionics. Again, the same groups wail that "chilling effects" will freeze "innovation" unless another federal law, (this time, § 512(c) of the DCMA), "harbors" corporations that intend to profit from rampant piracy by remaining willfully blind to harms and risks they have imposed on others. The Grokster Defenders thus sob that another Grokster-like failure to "harbor" culpable, massive piracy will "severely chill innovation," "damage[] Internet commerce," "severely damage innovation," and "be devastating to any new product and to the financial future of its marketer and developer...."

As in Grokster, these cut-and-paste histrionics are nonsense that became even more nonsensical when re-parroted in Viacom v. YouTube. The facts of Viacom strongly suggest that the original YouTube founders intended to, and did, use "whatever tactics, however evil"—to destroy law-abiding competitors like Google Video. Their plan was to grow their site through whatever means so they could "sell out quickly"—thus leaving a company like Google holding what the New York Times called a "litigation laden landmine."

Though I do admire both Google and today's YouTube, such facts make the equities (and ironies) of Viacom v. YouTube brutally clear: granting a § 512(c) "safe harbor" to the original YouTube—the "video Grokster"—would punish its would-be law-abiding competitors, like Google Video, because they respected copyrights. Such an interpretation would also punish today's law-abiding YouTube, which must now—like Google Video—compete against other streaming-video sites that are again "playing very fast and loose with the rules..."

Indeed, the facts of Viacom v. YouTube prove that interpreting § 512(c) to "harbor" hosting services that use piracy as "startup capital" to generate network effects, draw users, and cripple competitors would not just tolerate such conduct—it would require it. As one executive put it: "Shouldn't the lesson [of YouTube] be to play faster and looser and be aggressive until a court says 'no' or a deal gets struck? I don't think that there can be an in between..."

That is the "lesson" that the Grokster Defenders would interpret §512(c) of the DMCA to teach. Fortunately for artists and consumers, the histrionic illogic driving this attempt to circumvent Grokster is even less credible than the histrionic illogic that ensured Grokster's unanimous defeat in the Supreme Court.

BACKGROUND: The Grokster Defenders Ignore Both the Facts of Viacom and the Law of Statutory Interpretation in order to Again Defend Seemingly Deliberate Corporate Piracy.

The Grokster Defenders filed their amicus brief "in support of the Defendants" in Viacom v. YouTube. The Viacom Defendants were seeking a partial-summary-judgment order holding that the original YouTube qualified for the DMCA's § 512(c) "hosting-service safe harbor." Consequently, the Court adjudicating Viacom might think that the Grokster Defenders filed their "friend-of-the-court" brief because their notions of the "public interest" compel them to "support" the Viacom Defendants' right to the partial-summary-judgment order that they seek.

But that would be wrong. The amicus brief of the Grokster Defenders appears to be irrelevant—just one big fallacy of distraction. In effect, the Grokster Defenders argue only that they would support the Viacom Defendants' request for summary judgment IF the undisputed facts AND the governing law were radically different. Consequently, the Grokster Defenders do not "support" the Viacom Defendants at all. Apparently, not even the most radical defenders of the "unmistakable," "overwhelming," "replete," and "clear" piracy in Grokster can defend, on the actual facts and law, the conduct of the original YouTube founders.

Amici are supposed to be "friends of the Court." But Courts hardly need "friends" as useless as these. And with "friends" like these, the Viacom Defendants hardly need opponents.

"There is no spoon": the Grokster Defenders' reality-bending account of the "undisputed facts": To resolve a defense motion for partial summary judgment, a judge must interpret all material facts and all inferences that could be drawn from them in the way most favorable to the plaintiffs. Consequently, no amici can "support" any defendant's motion for summary judgment unless they actually confront these most-favorable-to-the-plaintiff "undisputed facts."

But the amicus brief of the Grokster Defenders does not. Instead, it just ceaselessly claims that even were all material facts and inferences in Viacom interpreted most favorably to the Plaintiffs, then the worst that could be said about the original YouTube founders was that they had some "general awareness that some users post infringing works on YouTube" (p.11).

That claim is pathetic and absurd. The evidence of intent presented in Viacom's Opening Brief, its Statement of Undisputed Facts, and its supporting Exhibits seems far more egregious, explicit, and plentiful than the evidence that caused federal courts to grant summary judgment for the plaintiffs in digital piracy cases like mp3.com, Napster, Aimster, Grokster, Usenet, Fung, and Lime Group.

The Grokster Defenders' interpretation of Section 512(c) ignores binding law and relies on legislative history: When interpreting federal statutes like § 512(c), federal judges interpret statutory terms in context, and they use the well-settled "ordinary-meaning" rule to interpret undefined statutory terms: if those terms echo legal "terms of art" that had specialized meanings under prior law, then they retain their specialized meanings, otherwise, they have their ordinary, dictionary-definition meanings. See, e.g., Neder v. United States, 527 U.S. 1, 21 (1999) (specialized meaning); Ardestani v. INS, 502 U.S. 129, 135-36 (1991) (dictionary-definition meaning). This ordinary-meaning rule protects the integrity of the legislative process by giving statutory terms the meaning that informed legislators and citizens should expect.

In rare cases, the ordinary meaning of a term can still be either ambiguous or vague when applied to a particular set of facts. In such cases, judges then use various "canons" of statutory interpretation to resolve ambiguities or vagueness. If even those techniques fail, some judges may even look to legislative history to resolve persistent ambiguity or vagueness. Nevertheless, all judges reject attempts to use legislative history to avoid the ordinary-meaning rule. See, e.g., Standefer v. United States, 447 U.S. 10, 20 n.12 (1980) (unanimously refusing to allow "legislative history to nullify the plain meaning of a statute").

Consequently, it is telling that the new amicus brief of the Grokster Defenders never acknowledges that the ordinary-meaning rule exists. It then becomes even more telling that their brief relies, instead, almost entirely upon legislative history: it cites or quotes legislative history 40 times in its 19 pages of Argument. Nor did it identify any unavoidable, unsolvable ambiguities or vagueness in the ordinary meaning of § 512(c) that would justify even one—much less 40—resorts to legislative history.

Such errors of law seem particularly inexcusable because even the fact-denying Grokster Defenders do admit that the summary-judgment motions in Viacom v. YouTube should turn upon the proper interpretation of § 512 of the DMCA, particularly the meaning of three of the four duties imposed by two of the three subsections of § 512(c)(1):

  • The Contributory-Liability Limitation: Subsections 512(c)(1)(A)(i) and (ii) deny § 512(c) protection to hosting services that have either "actual knowledge that the material... on the system or network is infringing," or that are "aware of facts and circumstances from which infringing activity is apparent" UNLESS they act "expeditiously to remove, or disable access to, the material..."
  • The Vicarious-Liability Limitation: Subsection 512(c)(1)(B) denies § 512(c) protection to hosting services that "receive a financial benefit directly attributable to the infringing activity, in a case in which the service provider has the right and ability to control such activity..."

Sections 512(c)(1)(A) and § 512(c)(1)(B) echo copyright law's traditional tests for contributory and vicarious liability. Traditionally, a defendant was contributorily liable if it had actual or constructive knowledge, (reason to know), that it was inducing, causing or materially contributing to infringement and vicariously liable if it derived a direct financial benefit from infringement that it had the ability to control. See, e.g., Gershwin Publishing Corp. v. Columbia Artist Management, Inc., 439 F.2d 1159, 1162 (2d Cir. 1971) (cited in Grokster, 545 U.S. at 930).

This is why the Grokster Defenders ignore the ordinary-meaning rule: it would dictate that except as otherwise specified in § 512, Congress—by using terms drawn from the law of contributory and vicarious liability—intended to deny a "harbor" to hosting sites engaging in the sorts of serious wrongdoing that had long been held, (both as to copyright and in almost all other areas of the law), to make it "just to hold one person accountable for the actions of another." Sony, 464 U.S. at 435.

That result would be eminently reasonable. In almost all areas of law, secondary-liability rules must deter the worst wrongdoers: those few who would exploit other human beings—particularly vulnerable people, like children, students and the unsophisticated—as mere pawns that cynics can manipulate, endanger and sacrifice in order to profit from wrongdoing without risk to themselves. As a result, the § 512(c) safe harbor could provide more "certainty" to law-abiding hosting services only so long as it avoided providing "certainty" to sociopaths seeking some legal means to use young, naive or vulnerable people as expendible pawns that can generate risk-free profits from wrongdoing.

ANALYSIS: The Vacuity of the Grokster Defenders' Takedowns-and-Daiquiris Interpretation of the § 512(c) Hosting-Site "Safe Harbor."

The Grokster Defenders must ignore both undisputed facts and governing law because Viacom v. YouTube provides a miserable vehicle for convincing judges to adopt the Grokster Defenders' "takedowns-and-daiquiris" interpretation of § 512(c)(1) of the DMCA.

This "takedowns-and-daiquiris" interpretation of § 512(c)(1) asserts that § 512(c) should protect even hosting-service operators who know that mass piracy idrives their site's popularity, revenues, and competitive advantage—so long as those operators also (1) carefully avoid learning about specific infringements, and (2) respond to "takedown" notices from some of the copyright owners that they harm. The takedowns-and-daiquiris interpretation of § 512(c)(1) thus argues that hosting-site operators can knowingly promote mass piracy while sitting in a legal "safe harbor"—profiting from piracy, drinking daiquiris, averting their eyes, and snorting with laughter as "the copyright bastards" chase armies of infringing teenagers, college students, and housewives around their site in an endless game of takedown-notice whack-a-mole.

And, yes, the takedowns-and-daiquiris interpretation of § 512(c)(1) is that cynical. Indeed, an even uglier version of the takedowns-and-daiquiris interpretation was articulated in what may prove to be the least prescient commentary on YouTube: Free-Culture-Movement law professor Tim Wu's 2006 Slate column, Does YouTube Really Have Legal Problems?

In this now-ironic column, Wu used the takedowns-and-daiquiris interpretation of § 512(c) to mock the "conventional wisdom" asserting that when Google bought YouTube, it also bought "a whole heap of copyright trouble." Wu thus scoffed at Mark Cuban for comparing YouTube to "Napster"—blissfully unaware that YouTube's founders hoped to emulate Napster, KaZaA and BitTorrent. Wu explained that the takedowns-and-daiquiris interpretation made such intent irrelevant: "[S]o long as YouTube acts "expeditiously" [when receiving a takedown notice] and so long as YouTube wasn't already aware that the material was there, YouTube is in the clear." Granted, § 512(c) did explicitly deny such protection to hosts "aware of facts and circumstances from which infringing activity is apparent," but Wu sneered that this limitation could "make trouble only in the hands of a judge who really hates 'that whole Web 2.0 thing.'" Wu thus concluded that hosting-service operators "can act out in cyberspace. Just don't be a copyright pimp."

And were that not cynical enough, then here is the takedowns-and-daiquiris interpretation of § 512(c) as explained—not by Wu or the Grokster Defenders—but by YouTube founder Steven Chen, objecting to another founder's proposal to remove from YouTube "obviously copyright infringing stuff":

"I know that if [we] remove all that content we go from 100,000 views a day down to about 20,000 views or maybe even lower. the copyright infringing stuff. I mean we can presumably claim that we don't know who owns the rights to that video and by uploading, the user is claiming that they own that video. we're protected by the DMCA for that. we'll take it down if we get a 'cease and desist.'"

"...we can presumably claim...?" Those words should rarely, if ever, be scribed by anyone other than a cynic explaining how the culpable can "play dumb" in order to conceal what they actually knew or intended.

Fortunately, not even the acrid cynicism of these accounts of the takedowns-and-daiquiris "interpretation" of § 512(c)(1) can conceal its two worst defects. The first is dispositive. The second is criminal.

First, the text of § 512(c)(1) cannot endure the takedowns-and-daiquiris interpretation. Section 512(c)(1) imposes four duties—three negative and one positive—upon "harbored" hosting services. All such services must: (1) avoid "actual knowledge" of unremediated infringement; (2) avoid awareness of "facts and circumstances from which [unremediated] infringing activity is apparent"; 3) avoid deriving "a financial benefit directly attributable to" infringing uses that "the service provider has the right and ability to control"; and 4) respond promptly to takedown notices from copyright owners.

But the takedowns-and-daiquiris interpretation of § 512(c) "harbors" even the most willfully blind hosts of massive, pervasive, profitable piracy—if they also respond to takedown notices. Consequently, this interpretation impermissibly reduces the second and third duties prescribed by § 512(c)(1) to surplusage—mere negative restatements of the duty to respond to takedown notices. So far, no one in Viacom v. YouTube—including the Grokster Defenders—has identified a known principle of statutory interpretation than could justify that result.

Second, service providers must remember that the § 512 "safe harbors" are not really "safe": they are just very significant limitations on the civil remedies that could otherwise be imposed against online service providers "by reason of infringement of copyrights..." See 17 U.S.C. § 512(c). Consequently, no subsection of § 512 can "harbor" or limit any provider's liability for any criminal conduct. And hosting-service operators who intend to aid and abet, (or who conspire to perpetuate), even one infringement do commit federal crimes. See, e.g., 18 U.S.C. § 2, 241, 307, 2319.

Worse yet, if any hosting service intends to facilitate massive piracy—the sort that could increase its daily "views" by 400%—then federal law no longer calls that business an "online service." Instead, it calls that business a "racketeering enterprise." See 18 U.S.C. § § 1961-68 (codifying the Racketeer Influenced and Corrupt Organizations Act ("RICO")); see also, id. at §2319; Grokster, 545 U.S. at 961 (Breyer, J., concurring) (noting RICO's relevance to Internet piracy cases). Predictably, not only did the DMCA's "safe harbors" fail to limit the criminal liability of any online service provider, they also failed to limit either the civil or criminal liability that RICO would otherwise impose upon any online "racketeering enterprise."

Consequently, hosting-service operators who might want to believe the sophistry of a Grokster Defender, a Wu, or a Chen should thus recall some truths the even Grokster Defendants themselves dimly and belatedly perceived: Such hosting-service operators have the right to remain silent. And anything that they say can be used against them in a court of law. Such operators might also want to consider how they would answer this question:

Do you really think that most judges and jurors will sympathize with grown-ups who knew or should have known that they were facilitating and profiting from massive piracy by shifting many of its inherent risks onto often-unsuspecting children and families who could them be used as "human shields" against the enforcement of artists' copyrights?

To avoid such realities, the Viacom amicus brief of the Grokster Defenders spouts an array of absurd legal arguments. None has any merit, and none can change the cold, hard truth: There has never been, and there should never be, any "safe harbor" for online racketeering enterprises.

Consequently, the following analyses merely highlight some more fatal defects in the Grokster Defenders' main fallacies of distraction.

The Grokster Defenders' Missing Argument: In Viacom v. YouTube, Viacom's Opening Brief centers on its claim that the original founders of YouTube intended to induce the sort of massive piracy unanimously condemned by the Supreme Court in Grokster. But the Grokster Defenders filed their amicus brief "In Support of Defendants" arguing that even were all facts and inferences in the case interpreted against them, the original YouTube would still inarguably qualify for the § 512(c) safe harbor. The Grokster Defenders obviously agree. But—why? And—how? The Grokster Defenders left such questions unanswered.

For example, the Grokster Defenders could have supported the Defendants' right to summary judgment by arguing that no reasonable person construing all facts in Viacom v. YouTube in the light most favorable to the Plaintiffs could possibly conclude that the whatever-tactics-however-evil founders of YouTube intended to induce the pervasive infringement that actually drove the popularity of their service. But not even the Grokster Defenders dared to make that argument.

Alternatively, the Grokster Defenders could also have supported the Defendant's right to summary judgment by arguing that § 512(c), as a matter of law, protects even hosting-service operators guilty of the sort of intentional inducement condemned not only by the Supreme Court in Grokster—but also by many provisions of the U.S. Criminal Code. But, again, not even the Grokster Defenders could make that argument.

Consequently the only amicus brief filed "In Support of the Defendants" in Viacom actually condemns them: The most radical defenders of the deliberate piracy in Grokster do seem to want the Viacom Defendants to win—they just cannot identify laws or facts that could produce their desired result.

Indeed, the Grokster Defenders only oblique attack on the Plaintiffs' intentional-inducement claim is pathetic. The Grokster Defenders accuse Viacom of arguing that it need not prove intent to establish intentional-inducement liability under Grokster (pp. 11,14): "Plaintiffs... contend that operating a hosting service with general awareness that some users infringe triggers liability under [Grokster]."

Nonsense: in Viacom's brief, the following heading introduced its inducement claim: "DEFENDANTS ARE LIABLE UNDER GROKSTER BECAUSE THEY INTENTIONALLY OPERATED YOUTUBE AS A HAVEN FOR MASSIVE INFRINGEMENT." Viacom—like everyone else—thus knows that inducement liability under Grokster requires a showing of intent. But Viacom also knows that intent can be inferred—as in Grokster—from facts and circumstances including those showing that the YouTube founders knew, were willfully blind to, or should have known, even generally, that massive infringement was driving he advertising revenues and the popularity that could let them "sell out quickly."

At best, the Grokster Defenders' inducement-directed arguments are thus— literally—trying to re-litigate Grokster by exhuming and reviving "reasoning" the Supreme Court specifically condemned. In Grokster, the Court held that the Ninth Circuit committed "error" by concluding that the Court's deliberately vague 5-4 majority opinion in Sony was intended to shield from contributory liability even a program distributor who intended to cause and profit from massive Internet piracy unless that distributor had, as to any given infringing use of its product, "'specific knowledge of infringement at a time at which they contributed to the infringement and failed to act upon that information." Grokster, 545 U.S. at 934.

The text of § 512(c)(1)(A) forecloses such interpretative shenanigans. Intent is a far more culpable mental state than actual or constructive knowledge. Consequently, when § 512(c)(1) denied protection to online service providers who actually or constructively know about widespread and unremediated infringing uses of their sites, it also necessarily denied such protection to those far more culpable providers who intend to use piracy to draw users, increase revenues and destroy competitors. See, e.g., Columbia Pictures Indus., Inc. v. Fung, No. CV 06-5578, 2009 U.S. Dist. LEXIS 122661 at *67 (C.D. Cal. Dec. 21, 2009) (finding defendant's compliance with its duty to respond to takedown notices irrelevant because "inducement liability and the [DMCA] safe harbors are inherently contradictory").

The Grokster Defenders' "Defies-Logic" Argument: The Grokster Defenders' broadest argument against using the ordinary-meaning rule to interpret § 512(c)(1) argues that its text "defies logic" if given its ordinary meaning:

At the heart of Plaintiffs' arguments is the view that the safe harbors simply do not apply to secondary liability claims... This view, however, directly contradicts Congress' clear, repeated instruction that "Section 512(c) limits the liability of qualifying service providers for claims of direct, vicarious and contributory infringement..." It also defies logic: "If the safe harbors from vicarious and contributory liability were available only to providers who were not vicariously or contributorily liable, a service provider could only qualify for the safe harbor when they didn't need one, and any provider needing the safe harbor would be ineligible."

For three reasons, only this self-refuting argument "defies logic."

First, the Grokster Defenders' defies-logic argument is a blazing non sequitur that quotes the legislative history that precludes its conclusion. For a hosting service, the greatest threat of copyright liability arises neither from culpability-based contributory liability nor control-based vicarious liability, but from strict direct liability for making and distributing unauthorized copies. Therefore, even a "harbor" granting no protection against secondary liability would still be invaluable to hosting services that could otherwise be directly liable for unauthorized copying and distribution.

Second, the § 512(c) safe harbor does provide harbored hosting-site operators with enhanced protection from contributory liability. Ordinarily, contributory liability attaches when defendants knew or should have known that their acts were facilitating the infringing acts of others. But under § 512(c)(1)(A), even otherwise-culpable hosting-site operators can still limit their liability by "act[ing] expeditiously to remove or disable access to, the infringing material..." Ordinarily, culpable actors cannot avoid monetary liability for contributory liability by calling "backies" and halting what they once facilitated.

Third, the § 512(c) safe harbor also provides harbored hosting-site operators with some enhanced protection from vicarious liability. For example, § 512(c) itself necessarily implies that merely owning servers that house a hosting service and responding expeditiously to takedown notices cannot, alone, prove the control and financial benefit that trigger the vicarious-liability disqualifier. In some jurisdictions, these protections arguably may not significantly narrow the scope of vicarious liability. See, e.g., Adobe Sys. Inc. v. Canus Productions, Inc., 173 F. Supp. 2d 1044, 1053-55 (C.D. Cal. 2001). But Congressional committees could still fairly claim that § 512(c) enhanced clarity, and thus narrowed the vicarious liability. Consequently, even were it legal to use legislative history to create a conflict that could narrow the ordinary meaning of enacted text, the legislative history of § 512(c) would fail to do so.

The Grokster Defenders' "Survey" Argument: While the preceding argument may best expose the illogic of the Grokster Defenders' takedowns-and-daiquiris interpretation of § 512(c), their "survey argument" may best expose its immorality. Here, the Grokster Defenders argue that the § 512(c)(1)(A)(ii) duty to avoid awareness "of facts and circumstances from which infringing activity is apparent" must be only an inane echo of the § 512(c)(1)(C) duty to respond to takedown notices. They argue that if § 512(c)(1)(A)(ii) did anything more, then, someday, copyright owners might stop sending takedown notices—a hypothetical possibility that would be wholly impermissible because it might someday make the takedown-notice provision of § 512(c)(1)(C) as meaningless as this argument would immediately make § 512(c)(1)(A)(ii):

[I]f general knowledge of infringement on a service-providers' system were enough to trigger the knowledge disqualifier, then the "notice-and-takedown" provisions of [ §512(c)(1)(C)] would be rendered superfluous. A copyright owner could simply commission a survey inquiring generally into the incidence of infringing activity on a service, provide it to the service provider, and thereby strip the provider of the safe harbor. This, in turn, would trigger, (in Plaintiffs' view) an ongoing and undefined "proactive obligation" to "look into the matter further."

For at least two reasons, this "survey argument" is not just wrong, it actually approaches the fine line that separates arguments that merely verge upon absurdity from those that verge upon sociopathy.

First, the "survey argument" backfires. The Grokster Defenders might want to distract attention from the facts of Viacom v. YouTube by telling campfires stories about hypothetical horribles. But even sophists weaving fallacies of distraction cannot entirely ignore reality—to distract effectively, hypothetical horrible must be worse than the actual facts of the case. Because if the facts of a case are even worse than an amici's hypothetical horribles, then even potentially distracting scary stories can backfire—squarely upon the very parties that sophists were "defending."

For example, no doubt the Grokster Defenders truly fear that someday, copyright owners might spend their own money in order to conduct and deliver a "survey" of a hosting service's content that could prove—even to operators who had otherwise averted their eyes to avoid any specific "knowledge" of the causes of their site's popularity and revenues.

But in Viacom v. YouTube, similar "surveys" were actually conducted repeatedly—by YouTube employees who then reported their results to the original YouTube (see here, here, and here). Such surveys thus ensured that the original YouTube had not only an acute awareness of "facts and circumstances from which [massive] infringing activity was apparent," but also lots of "actual knowledge" of specific infringing uses never "expeditiously" remediated.

These grim facts—facts worse than even the hypothetical horribles conjured by the Grokster Defenders—thus raise a question: Do the Grokster Defenders argue that their takedowns-and-daiquiris interpretation of § 512(c) lets the original YouTube sit in a safe harbor while ignoring even the mass-piracy findings of "surveys" conducted by its own employees? Sadly, the Grokster Defenders only highlighted the significance of this question—they did not answer it.

Second, the Grokster Defenders' survey argument gores principles of law, justice, and morality more fundamental than the mere dozens of Supreme-Court cases that require courts to use the "ordinary meaning" to interpret statutory text—like that in § 512(c)(1)(A)(ii) that denies a safe harbor to any hosting-site operator "aware of facts and circumstances from which infringing activity is apparent..."

The Grokster Defenders want § 512(c) to be interpreted to empower hosting-site operators to do nothing except profit from piracy and respond to takedown notices—even after others have spent their own money to prove that IF those operators weren't averting their eyes, THEN they would have long known that they were, in effect, "hosting" a racketeering enterprise engaged in the sort of massive piracy that seriously threatens not only the vitality of the federal civil rights of hundreds of thousands of entrepreneurial American artists, but also the security and safety of hundreds of thousands of American families and children who have no "safe-harbor" against monetary liability for copyright infringement.

Not only is that result foreclosed by the text of § 512(c)(1), it would be monstrous even were it a possible interpretation of the text. It would blatantly violate perhaps the first rule of civilized behavior taught in preschool: if you discover that you have made a big, slippery mess, then you must clean it up—before others get hurt.

Sadly, a few people never grasp this central lesson of preschool. Consequently, the vast majority who do must elect governments to enact laws and impose remedies that can compel even miscreants to conform their own behavior to basic norms of civility. Naturally, the norms that laws thus encode will almost inevitably condemn adults who actually or constructively know—even "generally"—that they are enriching themselves by encouraging millions of ordinary consumers, students and teenagers to endanger themselves and their families by committing potentially ruinous violations of the federal civil rights of the American artists whose creativity has inspired—and employed—millions by creating many world-leading American export industries.

Nothing about Section 512, the Internet, the TCP/IP protocols, or the World Wide Web has diminished the vitality of this fundamental, clean-up-your-own-mess principle. To the contrary, the Internet has merely enhanced the practical importance of requiring everyone—even hosting-service operators—to conform their own conduct to its teachings.

Nevertheless, the many "public interest" groups among the Grokster Defenders still leapt to defend the original YouTube founders—after their own words had exposed their scathing, cynical contempt for the "interest" of any pawn so meaningless and pathetic as some actual member of the "public." Consider, for example, the conduct of YouTube founder Steven Chen, one of the heroic "innovators" whom the Grokster Defenders so fear to burden with "chilling effects":

Chen opposed infringing uses of YouTube—when he thought that he or YouTube could be held monetarily liable for them. For example, Chen thus told his co-founder, Jared Karim, to stop posting on YouTube videos that Chen considered "stolen": "jawed, please stop putting stolen videos on the site. We're going to have a tough time defending the fact that we're not liable for the copyrighted material on the site because we didn't put it up when one of the co-founders is blatantly stealing content..." And Chen was right: even though he and his co-founders could benefit more than any mere user from "stolen videos" on YouTube, the legal penalties that could be imposed upon them for direct infringement were just not worth the risk.

But Chen responded differently when the same co-founder proposed to remove "obviously copyright infringing stuff" posted by ordinary YouTube users—single moms, teenagers, and college students. Then, Chen was all too willing to concoct any "presumably" credible excuse to let ordinary—and probably unknowing—YouTube users continue to impose upon themselves and their families the same potentially ruinous liability that Chen himself so justly feared:

"I know that if [we] remove all that content we go from 100,000 views a day down to about 20,000 views or maybe even lower. the copyright infringing stuff. I mean we can presumably claim that we don't know who owns the rights to that video and by uploading, the user is claiming that they own that video. we're protected by the DMCA for that. we'll take it down if we get a 'cease and desist.'"

Chen engaged in such conduct repeatedly. At one point he bragged about how takedowns could be partially implemented so users could still infringe "truckloads of... copyrighted content." He also insisted that when users post obviously unauthorized copyrighted content "we should just keep that stuff on the site." When another founder took down Family Guy clips, Chen objected: "shouldn't we just assume that a user uploading the content really owns the content...?" Time and again, Chen seemed unconcerned about ruinous risks that he otherwise feared, so long as they might be inflicted—not upon an important person like Steven Chen—but upon some mere YouTube user and his or her family.

The Grokster Defenders would "harbor" Chen's amoral conduct from any disruption but a takedown notice. Indeed, the Grokster Defenders' takedowns-and-daiquiris interpretation of § 512(c) would "harbor" the conduct of an operator "hosting" massive, global piracy from even the results of a "survey" that could alert even willfully-blind operators to the severity of both the harms that they had inflicted upon American artists and the risks that they had imposed upon American families. And it would do so even though courts deciding cases like Grokster, Napster, Fung, and Usenet relied on the results of such surveys to assess defendants' intent.

Consequently, more than the central premise of federal statutory interpretation should cause the sophistry of the Grokster Defenders to be rejected—again. Federal judges can rarely, if ever, use their powers of interpretation to conclude that Congress intended to grant a "safe harbor" to grown-ups who just sip their daiquiris and count their money—even after they "generally" know that they have intentionally, knowingly, or recklessly enriched themselves by encouraging or duping millions of children, teenagers, and ordinary consumers into committing the civil wrongs and federal crimes that generate most of their revenues and traffic.

That is lunacy. Any hosting service perpetuating massive piracy by "playing very fast and loose with the rules" is not just "playing" with "the rules." It is usurping artists' federal civil rights and endangering consumers' lives, homes, retirements, and college funds. Not even the legislative history so beloved by the Grokster Defenders can support such a result. See S. Rep. No. 105-190, at 8, 48 (the § 512 safe harbors are inapplicable to "pirate" websites); H.R. Rep. No. 105-551 (Part II), at 57 (when "the infringing nature" of the site "would be apparent from even a brief and causal viewing, safe harbor status . . . would not be appropriate").

The Grokster Defenders' "Privacy Protects Piracy" Argument: The Grokster Defenders' final effort to use legislative history to overrule the ordinary meaning of § § 512(c)(1)(A) and (B) argues that Congress intended for § 512(m) of the DMCA to empower hosting-service operators to remain willfully blind to massive piracy by feigning concern for the nonexistent "privacy" of users publishing videos to the entire world.

Again, cruel facts shatter this silly fallacy. Oblivious to all irony, the Grokster Defenders sob that § 512(m) must ensure that the YouTube founders, (who inarguably "knew" that rampant piracy drove their site's popularity), should never have to remediate it by conducting the sort of one-time assessment that Credit Suisse conducted to estimate rampant piracy's economic value to a corporation purchasing YouTube.

The Grokster Defenders derive this risible argument, (p.17) from an excerpt from the legislative history of § 512(m) of the DMCA, which states, "a service provider need not monitor its service or affirmatively seek facts indicating infringing activity." They then argue the contributory-liability and vicarious-liability limitations of § 512(c)(1)(A) and (B) lack their ordinary meaning because, otherwise, "harbored" hosting services would be forced to conduct the ongoing "monitoring" that § 512(m) merely permits. Predictably, the never-quoted text of § 512(m) immediately forecloses this "interpretation" of its intended meaning:

Protection of Privacy—Nothing in [ § 512] shall be construed to condition the applicability of subsections (a) through (d) on... a service provider monitoring its service or affirmatively seeking facts indicating infringing activity...

Section 512(m) thus immediately makes the point obscured by the Grokster Defenders' vicious abstraction of legislative history: § 512(m) was intended to protect Internet users' reasonable expectations of privacy—not service providers' profits from piracy. Indeed, even legislative history confirms that Congress enacted § 512(m) to ensure that services storing data that users would consider private—for example, email-hosting services or document-hosting services—could not credibly claim that copyright laws required ongoing monitoring of the contents of users' otherwise-private data. For two reasons, the Grokster Defenders' attempts to explain why privacy should "harbor" piracy fail miserably.

First, a protection-of-privacy-based argument derived from § 512(m) is just as irrelevant in Viacom v. YouTube as it should have been in UMG Recordings, Inc. v. Veoh Networks, Inc., 665 F. Supp. 2d 1099 (C.D. Cal. 2009). Like Veoh users, YouTube users have no "privacy" interests in videos uploaded to YouTube, with its motto of "Broadcast Yourself." Indeed, users who post videos on YouTube not only consent to their continuous "monitoring," (a.k.a. "viewing") by the world at large, they also authorize YouTube itself to transform, alter and commercially exploit their videos in all media and in any way. Section 512(m) is thus irrelevant to YouTube—except as a frail excuse.

Second, § 512(m) could not create a material conflict with the ordinary meaning of § 512(c)(1)(A) or (B) even were "protection of privacy" arguably relevant in the context of YouTube. Even were the contributory-liability and vicarious-liability limitations in § 512(c)(1) given their ordinary meanings, neither would require hosting services to conduct privacy-compromising ongoing "monitoring" in order to avoid liability.

Obviously, neither ongoing "monitoring" nor "seeking" of infringement are required to avoid actual or constructive knowledge of others' wrongdoing, contributory liability or disqualification under § 512(c)(1)(A). Nor are such efforts required to avoid vicarious liability or disqualification under § 512(c)(1)(B). Hosting-service operators choose to possess or lack the sort of practical ability to control their site that can trigger vicarious liability. Moreover, as Google realized, even a service clearly retaining its right and ability to control its content cannot be vicariously liable if it derives no "direct financial benefit" from any potentially infringing content.

To be sure, a hosting service generally aware that mass piracy drives the popularity and revenues of its content-controlled site should disqualify itself from § 512(c) and trigger both traditional contributory and vicarious liability—if it does not "expeditiously" halt infringement that it knew or should have known about. But the resulting one-time duty to clean up one's own public mess—a mess that threatens both the rights of artists and the safety of consumers—is not the sort of ongoing, privacy-impeding "monitoring" that § 512(m) permits, but does not require.

Consequently, had the original YouTube undertaken a one-time, reasonable effort to detect and deter massive piracy, it would have no more compromised users' "privacy" than Credit Suisse did when it conducted a similar analysis in order to value unremediated mass piracy. Not even trigger-happy EFF subsequently sued or condemned Credit Suisse or Google, thus foreclosing any claim that such a one-time assessment could conceivably compromise any YouTube user's reasonable expectation of "privacy."

In short, when its text is interpreted in context, § 512(m) grants neither the original YouTube in particular nor hosting-services generally any excuse to perpetuate mass piracy. To the contrary, § 512(m) provides only a very narrow form of privacy protection to Internet users. In itself, § 512(m) itself does not prevent or deter service providers from conducting even continuous, invasive monitoring of users' most private data—such providers can still qualify for any of § 512's many benefits. But § 512(m) does ensure that service providers conducting ongoing, intrusive monitoring of private data cannot blame their conduct on copyright laws.

This narrow user-privacy protection hardly creates some "conflict" with the ordinary meaning of § § 512(c)(1)(A) and (B) that empowers service providers to sit in a safe harbor, sip daiquiris, earn revenues, and rely upon willful blindness to avoid acquiring more particular and specific knowledge of massive piracy of which they were long "generally aware." Courts holding otherwise merely conjure a not-so-safe "racketeering harbor" in which conduct that could prove criminal intent somehow cannot prove civil actual or constructive knowledge under § § 512(c)(1)(A) and (B). See, e.g., In re Aimster Copyright Litig., 334 F.3d 643, 650, 657 (7th Cir. 2003) (noting that a service provider's willful blindness can prove its criminal intent). That is absurd.

Conclusion: Laws that Ignore Histrionics and Deter Mass Piracy Will Encourage—Not "Chill"—Productive Innovation and Lawful Internet Commerce.

The Grokster Defenders are again re-parroting familiar wails about "innovation" and "chilling effects"—still somehow unaware that both civil and criminal laws impose secondary liability for the purpose of "chilling" sophisticated adults from creating "innovative" schemes to profit from wrongdoing by inducing less sophisticated children and consumers to do their dirty work and act as their human shields.

Indeed, long ago, a champion of international copyright protection, the author Charles Dickens, wrote a novel called Oliver Twist. Many interpret it as an attempt to contrast the very best in human nature, (the orphan Oliver), against the very worst in human nature, (the fence Bill Sykes), and show how a lawless society might enable a fiend like Sykes to exploit and corrupt innocents like Oliver.

Bill Sykes, the villain of Oliver Twist, was both a fence and an inducer. Sykes wanted to profit by selling stolen goods. But Sykes knew that the penalties for stealing were too severe to justify risking his own neck. Sykes thus devised a scheme to profit from theft while offloading the worst of its risks upon others: he and his partner encouraged or duped children into doing the dirty work of actually stealing the goods that Sykes would then profitably fence. Dickens thought that was the most depraved and degenerate "business model" that adult humans could pursue.

Much has changed since Dickens wrote Oliver Twist, including the Supreme Court's Sony decision, the development of the TCP/IP protocols, and the enactment of the DMCA. But nothing has changed the immorality of the "business model" of Bill Sykes. It remains criminal, wrong, and thuggish—even if pursued as a form of what the Grokster Defenders would call "Internet commerce" (p.14). Someday, more decisions like Napster, Aimster, Grokster, Fung, Usenet, and Lime Group may enable even the Grokster Defenders to perceive this.

But not yet. Consequently, Viacom v. YouTube is now "hosting" a backfiring, fact-free, logic-defying, and amoral amicus brief—a pathetic "class reunion" for the most radical defenders of the intentional, massive Internet piracy unanimously condemned by the Supreme Court in Grokster. Federal judges might thus remember that in Grokster, the Court reversed those district and circuit judges who made the fatal mistake of taking the Grokster Defenders seriously.

NB: To be clear, I am not suggesting that in Viacom v. YouTube, any amicus brief reflecting genuine concern for the "public interest" must be "in Support of the Plaintiffs." For example, though I personally think the argument superfluous, I would not fault a public-interest group that disagreed with the Viacom Plaintiffs' claim that § 512(c) should harbor only entities like web-hosting services, not websites like YouTube. Nevertheless, groups disagreeing with only some of the Viacom Plaintiffs arguments cannot file an amicus brief "in Support of the Defendants." If nothing else, Grokster taught even the Grokster Defenders that when copyright owners sue utterly indefensible miscreants, even "public interest" groups hostile to copyrights must preserve at least a frail veneer of credibility by filing an amicus brief in support of neither party. "Defender of the Indefensible" is always a deliberately self-inflicted wound. It is not an unavoidable side-effect of having an opinion.

posted by Thomas Sydnor @ 7:55 AM | Advertising & Marketing , Copyright , IP , Innovation , Intermediary Deputization & Section 230 , Internet

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Tom, if you think (as a matter of policy) that file-sharing ought to be legal, and that copyright's fixation (get it?) on "copies" makes no sense in the digital age, then of course you're going to defend people who make programs that enable this.

Also, what's up with your, (interesting but very nonstandard), putting of side points in commas and parentheses? Did Disreali do it or something?

Posted by: yourpoint at May 21, 2010 8:04 PM

Disraeli. Apologies to the PM.

Posted by: yourpoint at May 21, 2010 8:05 PM

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Posted by: http://www.dasjagerhaus.com/node/3042/ at July 10, 2013 1:12 PM

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