Case 1:07-cv-02103-LLS Document 364 Filed 06/23/10 Page 1 of 30
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`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF NEW YORK
`----------------------------------------X
`VIACOM INTERNATIONAL INC., COMEDY
`PARTNERS, COUNTRY MUSIC TELEVISION,
`INC., PARAMOUNT PICTURES CORPORATION,
`and BLACK ENTERTAINMENT TELEVISION LLC,
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`Plaintiffs, 07 Civ. 2103 (LLS)
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`-against-
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`YOUTUBE, INC., YOUTUBE, LLC, and
`GOOGLE, INC.,
`Defendants,
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`
`
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`----------------------------------------X OPINION AND ORDER
`THE FOOTBALL ASSOCIATION PREMIER
`LEAGUE LIMITED, et al., on
`behalf of themselves and all
`others similarly situated,
`
`Plaintiffs,
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`
`-against-
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`YOUTUBE, INC., YOUTUBE, LLC, and
`GOOGLE, INC.,
`Defendants.
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`----------------------------------------X
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`Defendants move for summary judgment that they are
`entitled to the Digital Millennium Copyright Act’s (“DMCA”), 17
`U.S.C. § 512(c), “safe harbor” protection against all of
`plaintiffs’ direct and secondary infringement claims, including
`claims for “inducement” contributory liability, because they had
`insufficient notice, under the DMCA, of the particular
`infringements in suit.
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`
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`07 Civ. 3582 (LLS)
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`Case 1:07-cv-02103-LLS Document 364 Filed 06/23/10 Page 2 of 30
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`Plaintiffs cross-move for partial summary judgment
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`that defendants are not protected by the statutory “safe harbor”
`provision, but “are liable for the intentional infringement of
`thousands of Viacom’s copyrighted works, . . . for the vicarious
`infringement of those works, and for the direct infringement of
`those works . . . because: (1) Defendants had ‘actual
`knowledge’ and were ‘aware of facts and circumstances from which
`infringing activity [was] apparent,’ but failed to ‘act[]
`expeditiously’ to stop it; (2) Defendants ‘receive[d] a
`financial benefit directly attributable to the infringing
`activity’ and ‘had the right and ability to control such
`activity;’ and (3) Defendants’ infringement does not result
`solely from providing ‘storage at the direction of a user’ or
`any other Internet function specified in section 512.” (See the
`parties’ Notices of Motion).
`
`Resolution of the key legal issue presented on the
`parties’ cross-motions requires examination of the DMCA’s “safe
`harbor” provisions, 17 U.S.C. § 512(c), (m) and (n) which state:
` (c) Information residing on systems or networks at
`direction of users.—
` (1) In general.—A service provider shall not be
`liable for monetary relief, or, except as provided in
`subsection (j), for injunctive or other equitable
`relief, for infringement of copyright by reason of the
`storage at the direction of a user of material that
`resides on a system or network controlled or operated
`by or for the service provider, if the service
`provider—
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`Case 1:07-cv-02103-LLS Document 364 Filed 06/23/10 Page 3 of 30
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` (A)(i) does not have actual knowledge that the
`material or an activity using the material on the
`system or network is infringing;
` (ii) in the absence of such actual knowledge,
`is not aware of facts or circumstances from which
`infringing activity is apparent; or
` (iii) upon obtaining such knowledge or
`awareness, acts expeditiously to remove, or
`disable access to, the material;
` (B) does not 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; and
` (C) upon notification of claimed infringement
`as
`described
`in
`paragraph
`(3),
`responds
`expeditiously to remove, or disable access to,
`the material that is claimed to be infringing or
`to be the subject of infringing activity.
`
`(2) Designated agent.—The limitations on liability
`established in this subsection apply to a service
`provider only if the service provider has designated
`an agent to receive notifications of claimed
`infringement described in paragraph (3), by making
`available through its service, including on its
`website in a location accessible to the public, and by
`providing to the Copyright Office, substantially the
`following information:
`
`(A) the name, address, phone number, and
`electronic mail address of the agent.
`(B) Other contact information which the
`Register
`of
`Copyrights
`may
`deem
`appropriate.
`The Register of Copyrights shall maintain a current
`directory of agents available to the public for
`inspection, including through the Internet, in both
`electronic and hard copy formats, and may require
`payment of a fee by service providers to cover the
`costs of maintaining the directory.
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`Case 1:07-cv-02103-LLS Document 364 Filed 06/23/10 Page 4 of 30
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` (3) Elements of notification.—
` (A) To be effective under this subsection, a
`notification of claimed infringement must be a
`written communication provided to the designated
`agent of a service provider that includes
`substantially the following:
`
` (i) A physical or electronic signature
`of a person authorized to act on behalf of
`the owner of an exclusive right that is
`allegedly infringed.
` (ii) Identification of the copyrighted
`work claimed to have been infringed, or,
`if multiple copyrighted works at a single
`online site are covered by a single
`notification, a representative list of
`such works at that site.
` (iii) Identification of the material
`that is claimed to be infringing or to be
`the subject of infringing activity and
`that is to be removed or access to which
`is to be disabled, and information
`reasonably sufficient to permit the
`service provider to locate the material.
` (iv) Information reasonably sufficient
`to permit the service provider to contact
`the complaining party, such as an address,
`telephone number, and, if available, an
`electronic mail address at which the
`complaining party may be contacted.
` (v) A statement that the complaining
`party has a good faith belief that use of
`the material in the manner complained of
`is not authorized by the copyright owner,
`its agent, or the law.
` (vi) A statement that the information in
`the notification is accurate, and under
`penalty of perjury, that the complaining
`party is authorized to act on behalf of
`the owner of an exclusive right that is
`allegedly infringed.
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`Case 1:07-cv-02103-LLS Document 364 Filed 06/23/10 Page 5 of 30
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` (B)(i) Subject to clause (ii), a notification
`from a copyright owner or from a person
`authorized to act on behalf of the copyright
`owner that fails to comply substantially with the
`provisions of subparagraph (A) shall not be
`considered under paragraph (1)(A) in determining
`whether a service provider has actual knowledge
`or is aware of facts or circumstances from which
`infringing activity is apparent.
` (ii) In a case in which the notification that
`is provided to the service provider’s designated
`agent fails to comply substantially with all the
`provisions of subparagraph (A) but substantially
`complies with clauses (ii), (iii), and (iv) of
`subparagraph (A), clause (i) of this subparagraph
`applies only if the service provider promptly
`attempts to contact the person making the
`notification or takes other reasonable steps to
`assist in the receipt of notification that
`substantially complies with all the provisions of
`subparagraph (A).
`
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`* * *
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`
`
` (m) Protection of privacy.—Nothing in this
`section shall be construed to condition the
`applicability of subsections (a) through (d) on—
` (1) a service provider monitoring its
`service or affirmatively seeking facts
`indicating infringing activity, except to
`the extent consistent with a standard
`technical
`measure
`complying
`with
`the
`provisions of subsection (i); or
`
` (2) a service provider gaining access to,
`removing, or disabling access to material in
`cases in which such conduct is prohibited by
`law.
`
` (n) Construction.—Subsections (a), (b), (c),
`and (d) describe separate and distinct functions
`for purposes of applying this section. Whether a
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`Case 1:07-cv-02103-LLS Document 364 Filed 06/23/10 Page 6 of 30
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`service provider qualifies for the limitation on
`liability in any one of those subsections shall
`be based solely on the criteria in that
`subsection, and shall not affect a determination
`of whether that service provider qualifies for
`the limitations on liability under any other such
`subsection.
`
`Defendant YouTube, owned by defendant Google, operates
`
`a website at http://www.youtube.com onto which users may upload
`video files free of charge. Uploaded files are copied and
`formatted by YouTube’s computer systems, and then made available
`for viewing on YouTube. Presently, over 24 hours of new video-
`viewing time is uploaded to the YouTube website every minute.
`As a “provider of online services or network access, or the
`operator of facilities therefor” as defined in 17 U.S.C. §
`512(k)(1)(B), YouTube is a service provider for purposes of §
`512(c).
`From plaintiffs’ submissions on the motions, a jury
`
`could find that the defendants not only were generally aware of,
`but welcomed, copyright-infringing material being placed on
`their website. Such material was attractive to users, whose
`increased usage enhanced defendants’ income from advertisements
`displayed on certain pages of the website, with no
`discrimination between infringing and non-infringing content.
`
`Plaintiffs claim that “tens of thousands of videos on
`YouTube, resulting in hundreds of millions of views, were taken
`unlawfully
`from
`Viacom’s
`copyrighted
`works
`without
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`authorization” (Viacom Br., Dkt. No. 186, p. 1), and that
`“Defendants had ‘actual knowledge’ and were ‘aware of facts or
`circumstances from which infringing activity [was] apparent,’
`but failed to do anything about it.” (Id. at 4) (alteration in
`original).
`
`However, defendants designated an agent, and when they
`received specific notice that a particular item infringed a
`copyright, they swiftly removed it. It is uncontroverted that
`all the clips in suit are off the YouTube website, most having
`been removed in response to DMCA takedown notices.
`
`Thus, the critical question is whether the statutory
`phrases “actual knowledge that the material or an activity using
`the material on the system or network is infringing,” and “facts
`or circumstances from which infringing activity is apparent” in
`§ 512(c)(1)(A)(i) and (ii) mean a general awareness that there
`are infringements (here, claimed to be widespread and common),
`or rather mean actual or constructive knowledge of specific and
`identifiable infringements of individual items.
`
`
`1.
`Legislative History
`
`
`
`The Senate Committee on the Judiciary Report, S. Rep.
`No. 105-190 (1998), gives the background at page 8:
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` Due to the ease with which digital works can be
`copied
`and
`distributed
`worldwide
`virtually
`instantaneously, copyright owners will hesitate to
`make their works readily available on the Internet
`without reasonable assurance that they will be
`protected against massive piracy. Legislation
`implementing the treaties provides this protection and
`creates the legal platform for launching the global
`digital on-line marketplace for copyrighted works. It
`will
`facilitate
`making
`available
`quickly
`and
`conveniently via the Internet the movies, music,
`software, and literary works that are the fruit of
`American creative genius. It will also encourage the
`continued growth of the existing off-line global
`marketplace for copyrighted works in digital format by
`setting strong international copyright standards.
` At the same time, without clarification of their
`liability, service providers may hesitate to make the
`necessary investment in the expansion of the speed and
`capacity of the Internet. In the ordinary course of
`their operations service providers must engage in all
`kinds of acts that expose them to potential copyright
`infringement liability. For example, service
`providers must make innumerable electronic copies by
`simply transmitting information over the Internet.
`Certain electronic copies are made in order to host
`World Wide Web sites. Many service providers engage
`in directing users to sites in response to inquiries
`by users or they volunteer sites that users may find
`attractive. Some of these sites might contain
`infringing material. In short, by limiting the
`liability of service providers, the DMCA ensures that
`the efficiency of the Internet will continue to
`improve and that the variety and quality of services
`on the Internet will continue to expand.
`
`
`It elaborates:
`
`There have been several cases relevant to service
`provider liability for copyright infringement. Most
`have approached the issue from the standpoint of
`contributory and vicarious liability. Rather than
`embarking upon a wholesale clarification of these
`doctrines, the Committee decided to leave current law
`in its evolving state and, instead, to create a series
`of “safe harbors,” for certain common activities of
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`service providers. A service provider which qualifies
`for a safe harbor, receives the benefit of limited
`liability.
`
`Id. at 19 (footnote omitted).
`
`
`The Senate Judiciary Committee Report and the House
`Committee on Commerce Report, H.R. Rep. No. 105-551, pt. 2
`(1998), in almost identical language describe the DMCA’s purpose
`and structure (Senate Report at 40-41, House Report at 50):
` New section 512 contains limitations on service
`providers’ liability for five general categories of
`activity set forth in subsections (a) through (d) and
`subsection (f). As provided in subsection (k),
`section 512 is not intended to imply that a service
`provider is or is not liable as an infringer either
`for conduct that qualifies for a limitation of
`liability or for conduct that fails to so qualify.
`Rather, the limitations of liability apply if the
`provider is found to be liable under existing
`principles of law.
` The limitations in subsections (a) through (d)
`protect qualifying service providers from liability
`for all monetary relief for direct, vicarious and
`contributory infringement. Monetary relief is defined
`in subsection (j)(2) as encompassing damages, costs,
`attorneys’ fees, and any other form of monetary
`payment. These subsections also limit injunctive
`relief against qualifying service providers to the
`extent specified in subsection (i). To qualify for
`these protections, service providers must meet the
`conditions set forth in subsection (h), and service
`providers’ activities at issue must involve a function
`described in subsection (a), (b), (c), (d) or (f),
`respectively. The liability limitations apply to
`networks “operated by or for the service provider,”
`thereby protecting both service providers who offer a
`service and subcontractors who may operate parts of,
`or an entire, system or network for another service
`provider.
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`They discuss the “applicable knowledge standard”
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`(Senate Report at 44-45, House Report at 53-54):
`
`
` Subsection (c)(1)—In general.—Subsection (c)(1)(A)
`sets forth the applicable knowledge standard. This
`standard is met either by actual knowledge of
`infringement or in the absence of such knowledge by
`awareness of facts or circumstances from which
`infringing activity is apparent. The term “activity”
`is intended to mean activity using the material on the
`system or network. The Committee intends such
`activity to refer to wrongful activity that is
`occurring at the site on the provider’s system or
`network at which the material resides, regardless of
`whether copyright infringement is technically deemed
`to occur at that site or at the location where the
`material is received. For example, the activity at an
`online site offering audio or video may be
`unauthorized
`public
`performance
`of
`a
`musical
`composition, a sound recording, or an audio-visual
`work, rather than (or in addition to) the creation of
`an unauthorized copy of any of these works.
` Subsection (c)(1)(A)(ii) can best be described as a
`“red flag” test. As stated in subsection (l), a
`service provider need not monitor its service or
`affirmatively
`seek
`facts
`indicating
`infringing
`activity (except to the extent consistent with a
`standard technical measure complying with subsection
`(h)), in order to claim this limitation on liability
`(or, indeed any other limitation provided by the
`legislation). However, if the service provider
`becomes aware of a “red flag” from which infringing
`activity is apparent, it will lose the limitation of
`liability if it takes no action. The “red flag” test
`has both a subjective and an objective element. In
`determining whether the service provider was aware of
`a “red flag,” the subjective awareness of the service
`provider of the facts or circumstances in question
`must be determined. However, in deciding whether
`those facts or circumstances constitute a “red flag”—
`in other words, whether infringing activity would have
`been apparent to a reasonable person operating under
`the same or similar circumstances—an objective
`standard should be used.
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` Subsection (c)(1)(A)(iii) provides that once a
`service provider obtains actual knowledge or awareness
`of facts or circumstances from which infringing
`material or activity on the service provider’s system
`or network is apparent, the service provider does not
`lose the limitation of liability set forth in
`subsection (c) if it acts expeditiously to remove or
`disable access to the infringing material. Because
`the factual circumstances and technical parameters may
`vary from case to case, it is not possible to identify
`a uniform time limit for expeditious action.
` Subsection (c)(1)(B) sets forth the circumstances
`under which a service provider would lose the
`protection of subsection (c) by virtue of its benefit
`from the control over infringing activity. In
`determining whether the financial benefit criterion is
`satisfied, courts should take a common-sense, fact-
`based approach, not a formalistic one. In general, a
`service provider conducting a legitimate business
`would not be considered to receive a “financial
`benefit directly attributable to the infringing
`activity” where the infringer makes the same kind of
`payment as non-infringing users of the provider’s
`service. Thus, receiving a one-time set-up fee and
`flat periodic payments for service from a person
`engaging in infringing activities would not constitute
`receiving a “financial benefit directly attributable
`to the infringing activity.” Nor is subparagraph (B)
`intended to cover fees based on the length of the
`message (per number of bytes, for example) or by
`connect time. It would however, include any such fees
`where the value of the service lies in providing
`access to infringing material.
`
`and at Senate Report 45, House Report 54:
`
` Section 512 does not require use of the notice and
`take-down procedure. A service provider wishing to
`benefit from the limitation on liability under
`subsection (c) must “take down” or disable access to
`infringing material residing on its system or network
`of which it has actual knowledge or that meets the
`“red flag” test, even if the copyright owner or its
`agent does not notify it of a claimed infringement.
`On the other hand, the service provider is free to
`refuse to “take down” the material or site, even after
`receiving a notification of claimed infringement from
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`the copyright owner; in such a situation, the service
`provider’s liability, if any, will be decided without
`reference to section 512(c). For their part,
`copyright
`owners
`are
`not
`obligated
`to
`give
`notification of claimed infringement in order to
`enforce their rights. However, neither actual
`knowledge nor awareness of a red flag may be imputed
`to a service provider based on information from a
`copyright owner or its agent that does not comply with
`the notification provisions of subsection (c)(3), and
`the limitation of liability set forth in subsection
`(c) may apply.
`
`The reports continue (Senate Report at 46-47, House
`
`Report at 55-56):
`the
`that
`requires
`(c)(3)(A)(iii)
` Subsection
`copyright owner or its authorized agent provide the
`service
`provider
`with
`information
`reasonably
`sufficient to permit the service provider to identify
`and locate the allegedly infringing material. An
`example of such sufficient information would be a copy
`or description of the allegedly infringing material
`and the URL address of the location (web page) which
`is alleged to contain the infringing material. The
`goal of this provision is to provide the service
`provider with adequate information to find and address
`the allegedly infringing material expeditiously.
`
`* * *
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`
`
`
`
` Subsection (c)(3)(B) addresses the effect of
`notifications that do not substantially comply with
`the requirements of subsection (c)(3). Under this
`subsection, the court shall not consider such
`notifications as evidence of whether the service
`provider has actual knowledge, is aware of facts or
`circumstances, or has received a notification for
`purposes of subsection (c)(1)(A). However, a
`defective notice provided to the designated agent may
`be considered in evaluating the service provider’s
`knowledge or awareness of facts and circumstances, if
`(i) the complaining party has provided the requisite
`information concerning the identification of the
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`copyrighted work, identification of the allegedly
`infringing material, and information sufficient for
`the service provider to contact the complaining party,
`and (ii) the service provider does not promptly
`attempt to contact the person making the notification
`or take other reasonable steps to assist in the
`receipt of notification that substantially complies
`with paragraph (3)(A). If the service provider
`subsequently receives a substantially compliant
`notice, the provisions of paragraph (1)(C) would then
`apply upon receipt of the notice.
`
`When discussing section 512(d) of the DMCA which deals
`
`with information location tools, the Committee Reports contain
`an instructive explanation of the need for specificity (Senate
`Report at 48-49, House Report at 57-58):
` Like the information storage safe harbor in section
`512(c), a service provider would qualify for this safe
`harbor if, among other requirements, it “does not have
`actual knowledge that the material or activity is
`infringing” or, in the absence of such actual
`knowledge, it is “not aware of facts or circumstances
`from which infringing activity is apparent.” Under
`this standard, a service provider would have no
`obligation to seek out copyright infringement, but it
`would not qualify for the safe harbor if it had turned
`a blind eye to “red flags” of obvious infringement.
` For instance, the copyright owner could show that
`the provider was aware of facts from which infringing
`activity was apparent if the copyright owner could
`prove that the location was clearly, at the time the
`directory provider viewed it, a “pirate” site of the
`type described below, where sound recordings,
`software, movies or books were available for
`unauthorized downloading, public performance or public
`display. Absent such “red flags” or actual knowledge,
`a directory provider would not be similarly aware
`merely because it saw one or more well known
`photographs of a celebrity at a site devoted to that
`person. The provider could not be expected, during
`the course of its brief cataloguing visit, to
`determine whether the photograph was still protected
`by copyright or was in the public domain; if the
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`photograph was still protected by copyright, whether
`the use was licensed; and if the use was not licensed,
`whether it was permitted under the fair use doctrine.
` The important intended objective of this standard is
`to exclude sophisticated “pirate” directories—which
`refer Internet users to other selected Internet sites
`where pirate software, books, movies, and music can be
`downloaded or transmitted—from the safe harbor. Such
`pirate directories refer Internet users to sites that
`are obviously infringing because they typically use
`words such as “pirate,” “bootleg,” or slang terms in
`their uniform resource locator (URL) and header
`information to make their illegal purpose obvious to
`the pirate directories and other Internet users.
`Because the infringing nature of such sites would be
`apparent from even a brief and casual viewing, safe
`harbor status for a provider that views such a site
`and then establishes a link to it would not be
`appropriate. Pirate directories do not follow the
`routine business practices of legitimate service
`providers preparing directories, and thus evidence
`that they have viewed the infringing site may be all
`that is available for copyright owners to rebut their
`claim to a safe harbor.
` In this way, the “red flag” test in section 512(d)
`strikes the right balance. The common-sense result of
`this “red flag” test is that online editors and
`catalogers
`would
`not
`be
`required
`to
`make
`discriminating judgments about potential copyright
`infringement. If, however, an Internet site is
`obviously pirate, then seeing it may be all that is
`needed for the service provider to encounter a “red
`flag.” A provider proceeding in the face of such a
`red flag must do so without the benefit of a safe
`harbor.
` Information location tools are essential to the
`operation of the Internet; without them, users would
`not be able to find the information they need.
`Directories are particularly helpful in conducting
`effective searches by filtering out irrelevant and
`offensive material. The Yahoo! Directory, for
`example, currently categorizes over 800,000 online
`locations and serves as a “card catalogue” to the
`World Wide Web, which over 35,000,000 different users
`visit each month. Directories such as Yahoo!’s
`usually are created by people visiting sites to
`categorize them. It is precisely the human judgment
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`these
`by
`exercised
`discretion
`editorial
`and
`cataloguers which makes directories valuable.
` This provision is intended to promote the
`development of information location tools generally,
`and Internet directories such as Yahoo!’s in
`particular, by establishing a safe-harbor from
`copyright infringement liability for information
`location tool providers if they comply with the notice
`and takedown procedures and other requirements of
`subsection (d). The knowledge or awareness standard
`should not be applied in a manner which would create a
`disincentive to the development of directories which
`involve human intervention. Absent actual knowledge,
`awareness of infringement as provided in subsection
`(d) should typically be imputed to a directory
`provider only with respect to pirate sites or in
`similarly obvious and conspicuous circumstances, and
`not simply because the provider viewed an infringing
`site during the course of assembling the directory.
`
`The tenor of the foregoing provisions is that the
`
`phrases “actual knowledge that the material or an activity” is
`infringing, and “facts or circumstances” indicating infringing
`activity, describe knowledge of specific and identifiable
`infringements of particular individual items. Mere knowledge of
`prevalence of such activity in general is not enough. That is
`consistent with an area of the law devoted to protection of
`distinctive individual works, not of libraries. To let
`knowledge of a generalized practice of infringement in the
`industry, or of a proclivity of users to post infringing
`materials, impose responsibility on service providers to
`discover which of their users’ postings infringe a copyright
`would contravene the structure and operation of the DMCA. As
`
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`Case 1:07-cv-02103-LLS Document 364 Filed 06/23/10 Page 16 of 30
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`stated in Perfect 10, Inc. v. CCBill LLC, 488 F.3d 1102, 1113
`(9th Cir. 2007):
`The DMCA notification procedures place the burden of
`policing
`copyright
`infringement—identifying
`the
`potentially
`infringing
`material
`and
`adequately
`documenting infringement—squarely on the owners of the
`copyright. We decline to shift a substantial burden
`from the copyright owner to the provider . . . .
`
`That makes sense, as the infringing works in suit may
`
`be a small fraction of millions of works posted by others on the
`service’s platform, whose provider cannot by inspection
`determine whether the use has been licensed by the owner, or
`whether its posting is a “fair use” of the material, or even
`whether its copyright owner or licensee objects to its posting.
`The DMCA is explicit: it shall not be construed to condition
`“safe harbor” protection on “a service provider monitoring its
`service or affirmatively seeking facts indicating infringing
`activity . . . .” Id. § 512(m)(1); see Senate Report at 44,
`House Report at 53.
`
`Indeed, the present case shows that the DMCA
`notification regime works efficiently: when Viacom over a
`period of months accumulated some 100,000 videos and then sent
`one mass take-down notice on February 2, 2007, by the next
`business day YouTube had removed virtually all of them.
`
`
`
`
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`Case 1:07-cv-02103-LLS Document 364 Filed 06/23/10 Page 17 of 30
`
`2.
`Case Law
`
`
`
`In CCBill LLC, supra, the defendants provided web
`hosting and other services to various websites. The plaintiff
`argued that defendants had received notice of apparent
`infringement from circumstances that raised “red flags”:
`websites were named “illegal.net” and “stolencelebritypics.com,”
`and others involved “password-hacking.” 488 F.3d at 1114
`(internal quotation marks omitted). As to each ground, the
`Ninth Circuit disagreed, stating “We do not place the burden of
`determining whether photographs are actually illegal on a
`service provider”; and “There is simply no way for a service
`provider to conclude that the passwords enabled infringement
`without trying the passwords, and verifying that they enabled
`illegal access to copyrighted material. We impose no such
`investigative duties on service providers.” Id.
`
`The District Court in UMG Recordings, Inc. v. Veoh
`Networks, Inc., 665 F. Supp. 2d 1099, 1108 (C.D. Cal. 2009),
`concluded that “CCBill teaches that if investigation of ‘facts
`and circumstances’ is required to identify material as
`infringing, then those facts and circumstances are not ‘red
`flags.’” That observation captures the reason why awareness of
`pervasive copyright-infringing, however flagrant and blatant,
`
`
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`Case 1:07-cv-02103-LLS Document 364 Filed 06/23/10 Page 18 of 30
`
`does not impose liability on the service provider. It furnishes
`at most a statistical estimate of the chance any particular
`posting is infringing — and that is not a “red flag” marking any
`particular work.
`
`In Corbis Corp. v. Amazon.com, Inc., 351 F. Supp. 2d
`1090, 1108 (W.D. Wash. 2004) the court stated that “The issue is
`not whether Amazon had a general awareness that a particular
`type of item may be easily infringed. The issue is whether
`Amazon actually knew that specific zShops vendors were selling
`items that infringed Corbis copyrights.” It required a “showing
`that those sites contained the type of blatant infringing
`activity that would have sent up a red flag for Amazon.” Id. at
`1109. Other evidence of “red flags” was unavailing, for it
`“provides no evidence from which to infer that Amazon was aware
`of, but chose to ignore, red flags of blatant copyright
`infringement on specific zShops sites.” Id.
`
`A similar recent decision of the Second Circuit
`involved analogous claims of trademark infringement (and
`therefore did not involve the DMCA) by sales of counterfeit
`Tiffany