`
`No. 16-
`
`
`
`IN THE
`Supreme Court of the United States
`___________
`CAPITOL RECORDS, LLC, CAROLINE RECORDS, INC., VIR-
`GIN RECORDS AMERICA, INC., EMI BLACKWOOD MUSIC,
`INC., EMI APRIL MUSIC, INC., EMI VIRGIN MUSIC, INC.,
`COLGEMS-EMI MUSIC, INC., EMI VIRGIN SONGS, INC.,
`EMI GOLD HORIZON MUSIC CORP., EMI UNART CATA-
`LOG, INC., STONE DIAMOND MUSIC CORPORATION,
`EMI U CATALOG, INC., JOBETE MUSIC CO., INC.,
`Petitioners,
`
`v.
`VIMEO, LLC, CONNECTED VENTURES, LLC,
`DOES, 1-20 INCLUSIVE,
`
`Respondents.
`
`___________
`On Petition for a Writ of Certiorari
`to the United States Court of Appeals
`for the Second Circuit
`___________
`PETITION FOR A WRIT OF CERTIORARI
`___________
`
`RUSSELL J. FRACKMAN
`CARTER G. PHILLIPS *
`MARC E. MAYER
`KWAKU A. AKOWUAH
`MITCHELL SILBERBERG &
`REBECCA S. LEVENSON
` KNUPP LLP
`SIDLEY AUSTIN LLP
`11377 West Olympic
`1501 K Street, N.W.
` Boulevard
`Washington, D.C. 20005
`Los Angeles, CA 90064
`(202) 736-8000
`cphillips@sidley.com
`(310) 312-2000
`
`
`CONSTANTINE L. TRELA, JR.
`
`
`SIDLEY AUSTIN LLP
`
`One South Dearborn
`
`Chicago, IL 60603
`
`(312) 853-7000
`Counsel for Petitioners
`December 14, 2016 * Counsel of Record
`
`
`
`
`
`
`
`
`QUESTION PRESENTED
`Section 301(c) of the Copyright Act states that
`“[w]ith respect to sound recordings fixed before Feb-
`ruary 15, 1972, any rights or remedies under the
`common law or statutes of any State shall not be an-
`nulled or limited [by the Copyright Act] until Febru-
`ary 15, 2067.”
`The question presented is whether the Second Cir-
`cuit erred in holding, contrary to the considered view
`of the United States Copyright Office and in conflict
`with New York state appellate courts, that when
`Congress enacted the Digital Millennium Copyright
`Act and added section 512 to the Copyright Act, it
`implicitly limited and preempted the very state-law
`rights and remedies that section 301(c) says “shall
`not be annulled or limited.”
`
`
`(i)
`
`
`
`ii
`PARTIES TO THE PROCEEDINGS
`The petitioners herein, plaintiffs/appellees-cross-
`appellants below, are Capitol Records, LLC, Caroline
`Records, Inc., Virgin Records America, Inc., EMI
`Blackwood Music, Inc., EMI April Music, Inc., EMI
`Virgin Music, Inc., Colgems-EMI Music, Inc., EMI
`Virgin Songs, Inc., EMI Gold Horizon Music Corp.,
`EMI Unart Catalog, Inc., Stone Diamond Music Cor-
`poration, EMI U Catalog, Inc., and Jobete Music Co.,
`Inc.
`The respondents herein, defendants/appellants-
`cross-appellees below, are Vimeo, LLC, Connected
`Ventures, LLC, and Does 1-20 inclusive.
`
`
`
`
`
`
`iii
`CORPORATE DISCLOSURE
`PURSUANT TO RULE 29.6
`Petitioners Caroline Records, Inc. and Virgin Rec-
`ords America, Inc. have merged into Petitioner Capi-
`tol Records, LLC, a Delaware limited liability compa-
`ny. Capitol Records, LLC’s parent companies include
`Virgin Records CM Holdings, Inc., a Delaware corpo-
`ration; EMI RM US, Inc., a Delaware corporation;
`EMI Group Inc., a Delaware corporation; and Univer-
`sal Music Group, Inc., a Delaware corporation. The
`ultimate parent of Capitol Records, LLC is Vivendi,
`S.A., a publicly traded French corporation.
`Petitioners EMI Blackwood Music, Inc., EMI April
`Music, Inc., EMI Virgin Music, Inc., Colgems-EMI
`Music, Inc., EMI Virgin Songs, Inc., EMI Gold Hori-
`zon Music Corp., EMI U Catalog, Inc., EMI Unart
`Catalog Inc., Jobete Music Co., Inc., and Stone Dia-
`mond Music Corporation are all partially owned, in-
`direct subsidiaries of Sony Corporation, a publicly-
`traded company organized under the laws of Japan.
`No publicly traded company other than Sony Corpo-
`ration owns more than 10% of their stock.
`
`
`
`
`
`
`
`
`TABLE OF CONTENTS
`
`Page
`QUESTION PRESENTED ...................................
`i
`PARTIES TO THE PROCEEDINGS ...................
`ii
`CORPORATE DISCLOSURE PURSUANT TO
`iii
`RULE 29.6 .........................................................
`TABLE OF AUTHORITIES ................................. vii
`OPINIONS BELOW .............................................
`1
`JURISDICTION ...................................................
`1
`STATUTORY PROVISIONS INVOLVED ...........
`2
`INTRODUCTION .................................................
`2
`STATEMENT OF THE CASE..............................
`6
`REASONS FOR GRANTING THE PETITION ... 17
`I. THE DECISION BELOW CREATES A
`DIRECT AND INTOLERABLE SPLIT
`BETWEEN THE SECOND CIRCUIT AND
`THE STATE COURTS OF NEW YORK ...... 17
`II. THE QUESTION PRESENTED IS CRITI-
`CALLY IMPORTANT TO THE MUSIC
`INDUSTRY AND TO HOLDERS OF
`RIGHTS IN PRE-1972 SOUND RECORD-
`INGS .............................................................. 20
`III. THE SECOND CIRCUIT’S CONCLUSION
`IS PLAINLY INCORRECT AND CON-
`FLICTS IN SEVERAL RESPECTS WITH
`DECISIONS OF THIS COURT .................... 23
`A. The Second Circuit’s Construction Of
`Section 301(c) Is Untenable ...................... 24
`B. The Second Circuit’s Construction Of
`Section 512 Is Untenable .......................... 27
`
`(v)
`
`
`
`vi
`TABLE OF CONTENTS—continued
`
`Page
`
`C. The Second Circuit’s Policy Analysis
`Does Not Withstand Scrutiny .................. 31
`CONCLUSION ..................................................... 33
`APPENDICES
`APPENDIX A: Capitol Records, LLC v. Vimeo,
`LLC, 826 F.3d 78 (2d Cir. 2016) ........................ 1a
`APPENDIX B: Capitol Records, LLC v. Vimeo,
`LLC, 972 F. Supp. 2d 537 (S.D.N.Y. 2013) ....... 41a
`APPENDIX C: Capitol Records, LLC v. Vimeo,
`LLC, 972 F. Supp. 2d 500 (S.D.N.Y. 2013) ....... 74a
`APPENDIX D: Capitol Records, LLC v. Vimeo,
`LLC, Nos. 14-1048 et al. (2d Cir. Aug. 15,
`2016) ................................................................... 145a
`APPENDIX E: Federal Statutes ......................... 148a
`
`
`
`
`
`
`
`vii
`TABLE OF AUTHORITIES
`
`Page
`
`CASES
`Bond v. United States, 134 S. Ct. 2077
`(2014) .......................................................... 5, 25
`Capitol Records, Inc. v. MP3tunes, LLC,
`821 F. Supp. 2d 627 (S.D.N.Y. 2011) ......... 13
`Capitol Records, Inc. v. Naxos of Am., Inc.,
`372 F.3d 471 (2d Cir. 2004) ....................... 23
`Capitol Records, LLC v. BlueBeat, Inc., 765
`F. Supp. 2d 1198 (C.D. Cal. 2010) ............. 23
`Egelhoff v. Egelhoff ex rel. Breiner, 532
`U.S. 141 (2001) ........................................... 25
`Inc. v.
`EMI Christian Music Grp.,
`MP3tunes, LLC, 840 F.3d 69 (2d Cir.
`2016) ........................................................... 13
`Flo & Eddie Inc. v. Sirius XM Radio Inc.,
`No. 13-5693, 2014 WL 4725382 (C.D. Cal.
`Sept. 22, 2014) ............................................ 22
`Fortnightly Corp. v. United Artists
`Television, Inc., 392 U.S. 390 (1968),
`superseded on other grounds by statute,
`Copyright Act of 1976, Pub. L. No. 94-
`553, 90 Stat. 2541, as recognized in
`Capital Cities Cable, Inc. v. Crisp, 467
`U.S. 691 (1984) ...................................... 5, 28, 29
`Goldstein v. California, 412 U.S. 546
`(1973) .......................................................... 9, 25
`J.E.M. Ag Supply v. Pioneer Hi-Bred Int’l
`Inc., 534 U.S. 124 (2001) ............................ 27
`Lovilia Coal Co. v. Williams, 143 F.3d 317
`(7th Cir. 1998) ............................................ 25
`Microsoft Corp. v. AT&T Corp., 550 U.S.
`437 (2007) ................................................... 4, 10
`Nat’l Ass’n of Home Builders v. Defenders
`of Wildlife, 551 U.S. 644 (2007) ................. 26
`People v. Turner, 5 N.Y.3d 476 (2005) .......... 19
`
`
`
`
`
`viii
`TABLE OF AUTHORITIES—continued
`
`Page
`
`Rodriguez v. United States, 480 U.S. 522
`(1987) .......................................................... 33
`Sheridan v. Sirius Xm Radio, Inc., No. 15-
`7576, 2016 WL 1060361 (D.N.J. Mar. 16,
`2016) ........................................................... 22
`Teleprompter Corp. v. CBS, Inc., 415 U.S.
`394 (1974), superseded on other grounds
`by statute, Copyright Act of 1976, Pub. L.
`No. 94-553, 90 Stat. 2541, as recognized
`in Capital Cities Cable, Inc. v. Crisp, 467
`U.S. 691 (1984) ........................................... 5, 28
`TVA v. Hill, 437 U.S. 153 (1978) .................. 26
`U.S. Dep’t of Treasury v. Fabe, 508 U.S.
`491 (1993) ................................................... 2, 25
`UMG Recordings, Inc. v. Escape Media
`Grp., Inc, 107 A.D.3d 51 (2013) ............. passim
`
`3
`3
`
`
`STATUTES
`Act of Feb. 3, 1831, ch. 16, 4 Stat. 436 .........
`Act of Mar. 3, 1865, ch. 126, 13 Stat. 540 .....
`Sound Recording Amendment Act, Pub. L.
`No. 92-140, 85 Stat. 391 (1971) ................. 3, 9
`Copyright Act of 1976, Pub. L. No. 94-553,
`90 Stat. 2541 .............................................. 10
`Sonny Bono Copyright Term Extension
`Act, Pub. L. No. 105-298, 112 Stat. 2827
`(1998) .......................................................... 10
`17 U.S.C. § 101 ...................................... 11, 21, 29
`
`
`§ 106 ............................................. 11, 21
`
`
`§ 107 .............................................. 30
`
`
`§ 108(a) .......................................... 30
`
`
`§ 111(a) .......................................... 30
`
`
`§ 112(a)(1) ..................................... 30
`
`
`§ 121 .............................................. 30
`
`
`
`
`
`ix
`TABLE OF AUTHORITIES—continued
`
`Page
`17 U.S.C. § 301 .......................................... passim
`
`
`§ 501(a) .......................................... 28
`
`
`§ 502 .............................................. 22
`
`
`§ 504 .............................................. 22
`
`
`§ 505 .............................................. 22
`
`
`§ 512 ................................. 11, 12, 27, 29
`
`
`§ 912(d) .......................................... 31
`
`
`§ 1101(d) ........................................ 31
`
`
`§ 1201 ............................................ 21
`
`
`§ 1202 ............................................ 21
`
`
`§ 1330(1) ........................................ 31
`28 U.S.C. § 1367 ............................................ 15
`
`LEGISLATIVE HISTORY
`2 Omnibus Appropriations Act, 2009, H.
`Comm. on Appropriations on H.R. 1105,
`Public Law 111-8, Legislative Text and
`Explanatory Statement (Comm. Print
`2009) ........................................................... 4, 12
`155 Cong. Rec. H2397 (daily ed. Feb. 23,
`2009) ........................................................... 12
`
`
`SCHOLARLY AUTHORITY
`S.A. Diamond, Sound Recordings and
`Phonorecords: History and Current Law,
`1979 U. Ill. L.F. 337 ...................................
`
`
`OTHER AUTHORITIES
`IAC Q3 2016 Shareholder Letter (Nov. 2,
`2016), http://ir.iac.com/results.cfm ............
`
`8
`
`7
`
`
`
`
`
`x
`TABLE OF AUTHORITIES—continued
`
`Page
`
`S.E. Siwek, Inst. for Policy Innovation, The
`True Cost of Sound Recording Piracy to
`the U.S. Economy (2007), https://www.
`riaa.com/wp-content/uploads/2015/09/
`20120515_SoundRecordingPiracy.pdf ....... 21
`U.S. Copyright Office, Federal Copyright
`Protection for Pre-1972 Sound Recordings
`(Dec. 2011) .............................................. passim
`
`
`
`
`
`
`
`
`
`PETITION FOR A WRIT OF CERTIORARI
`Petitioners Capitol Records, LLC, Caroline Records,
`Inc., Virgin Records America, Inc., EMI Blackwood
`Music, Inc., EMI April Music, Inc., EMI Virgin Music,
`Inc., Colgems-EMI Music, Inc., EMI Virgin Songs,
`Inc., EMI Gold Horizon Music Corp., EMI Unart Cat-
`alog Inc., Stone Diamond Music Corporation, EMI U
`Catalog, Inc., and Jobete Music Co., Inc. (collectively,
`“Capitol Records”) respectfully petition for a writ of
`certiorari to review the judgment of the United States
`Court of Appeals for the Second Circuit.
`OPINIONS BELOW
`The Second Circuit’s opinion is available at 826
`F.3d 78 and is reproduced at Pet. App. 1a-40a. The
`Second Circuit vacated in part an order of the South-
`ern District of New York (Abrams, J.). The district
`court’s initial opinion is available at 972 F. Supp. 2d
`500 and is reproduced at Pet. App. 74a-144a. Upon
`subsequent briefing, including with respect to Re-
`spondents’ request that the statutory question here
`presented be certified for interlocutory review, the
`district court amended its initial order in an opinion
`available at 972 F. Supp. 2d 537 and reproduced at
`Pet. App. 41a-73a.
`JURISDICTION
`The Second Circuit entered judgment on June 16,
`2016, Pet. App. 1a-40a, and denied Petitioners’ peti-
`tion for en banc rehearing on August 15, 2016, Pet.
`App. 145a-147a. On October 31, 2016, Justice Gins-
`burg extended the time for filing the petition to De-
`cember 14, 2016. This Court has jurisdiction under 28
`U.S.C. § 1254(1).
`
`
`
`
`
`2
`STATUTORY PROVISIONS INVOLVED
`Sections 301 and 512 of Title 17 U.S.C. are repro-
`duced at Pet. App. 148a-169a.
`INTRODUCTION
`On February 15, 1972, Congress made sound re-
`cordings eligible for federal copyright protection for
`the very first time. It did so against a backdrop of
`more than 100 years of state-law protection for such
`recordings. And Congress specifically determined
`that those state-law protections should remain in
`place for pre-existing recordings. To that end, section
`301(c) of the Copyright Act today provides that, with
`respect to sound recordings fixed before February 15,
`1972, “rights or remedies under the common law or
`statutes of any State shall not be annulled or limited
`by [the Copyright Act] until February 15, 2067.” 17
`U.S.C. § 301(c). As this Court has recognized, stat-
`utes such as this, which announce the regulatory
`primacy of the States in an area potentially subject to
`Congressional control, “transform[] the legal land-
`scape by overturning the normal rules of pre-
`emption.” U.S. Dep’t of Treasury v. Fabe, 508 U.S.
`491, 507 (1993). That is, they “impos[e] what is, in
`effect, a clear-statement rule” that “state laws . . . do
`not yield to conflicting federal statutes unless a fed-
`eral statute specifically requires otherwise.” Id.
`The Second Circuit disregarded this clear di-
`rective. It held that the 1998 enactment of the Digital
`Millennium Copyright Act (“DMCA”) modified the
`rule of state-law exclusivity established by section
`301(c) and effected the precise annulment and limita-
`tion of state law rights and remedies that Congress
`had ruled out. The lower court did so despite the fact
`that the DMCA does not say a single word about
`state-law rights in pre-1972 sound recordings nor
`
`
`
`
`3
`about section 301(c). And it did so even though Con-
`gress enacted the DMCA one day after it expressly
`re-enacted, and extended by 20 years (until 2067),
`section 301(c)’s express rule of state-law supremacy.
`The Second Circuit’s decision puts it in square
`conflict with the state courts of New York, see UMG
`Recordings, Inc. v. Escape Media Grp., Inc., 107
`A.D.3d 51 (2013), and the United States Copyright
`Office, and reads the Copyright Act in a manner con-
`trary to this Court’s decisions. The lower court set
`aside the statutory language, and the legislative bal-
`ance of competing interests that language reflects, in
`favor of its own policy judgments. Its decision strips
`owners of pre-1972 sound recordings of state-law
`rights and remedies, even though they have been ac-
`corded none of the federal rights and remedies the
`Copyright Act provides. That cannot be what Con-
`gress intended.
`When Congress decided to make sound recordings
`eligible for federal copyright protection, it was keenly
`aware that the States had been creating and protect-
`ing property rights in such recordings for decades. In
`keeping with historical practice, Congress decided not
`to disturb those vested state-law rights. See Act of
`Feb. 3, 1831, ch. 16, § 1, 4 Stat. 436, 436 (making mu-
`sical compositions copyrightable on a prospective ba-
`sis only); Act of Mar. 3, 1865, ch. 126, § 1, 13 Stat.
`540, 540 (same as to photographs). Congress instead
`provided that “nothing in [the Copyright Act] shall be
`applied retroactively or construed as affecting in any
`way any rights with respect to sound recordings fixed
`before the effective date of this Act.” Pub. L. No. 92-
`140, § 3, 85 Stat. 391, 392 (1971). Today, 17 U.S.C.
`§ 301(c) carries forward that consistent legislative
`judgment, declaring that “[w]ith respect to sound re-
`cordings fixed before February 15, 1972, any rights or
`
`
`
`
`
`4
`remedies under the common law or statutes of any
`State shall not be annulled or limited by this title un-
`til February 15, 2067.”
`Moreover, in 2009, Congress directed the Copy-
`right Office to “conduct a study on the desirability of
`and means for bringing sound recordings fixed before
`February 15, 1972, under federal jurisdiction.” 2 Om-
`nibus Appropriations Act, 2009, H. Comm. on Appro-
`priations on H.R. 1105, Public Law 111-8, Legislative
`Text and Explanatory Statement 1769 (Comm. Print
`2009). The obvious import of that directive is that
`pre-1972 sound recordings are not currently “under
`federal jurisdiction.” The Copyright Office unsurpris-
`ingly echoed that conclusion in its report to Congress.
`See U.S. Copyright Office, Federal Copyright Protec-
`tion for Pre-1972 Sound Recordings 130-32 (Dec.
`2011) (“Copyright Office Report”).
`Despite all that, the Second Circuit held that
`state-law rights and remedies in pre-1972 sound re-
`cordings are preempted, in part, by federal law. It
`reasoned that, without saying so expressly, Congress
`carved a “tiny exception” (Pet. App. 24a) to sec-
`tion 301(c)’s general rule of state-law exclusivity
`when it enacted the DMCA.
`That conclusion is plainly incorrect. The DMCA
`sought in principal part to address “the ease with
`which pirates could copy and distribute a copyrighta-
`ble work in digital form.” Microsoft Corp. v. AT&T
`Corp., 550 U.S. 437, 458 (2007). It did so by pairing
`expanded protections
`for owners of
`federally-
`protected works (including increased sanctions for
`online violators of federal rights), with new “safe har-
`bor” defenses against liability for certain internet
`service providers—those willing to take responsible
`and effective actions to help meet the challenges pre-
`sented by online piracy.
`
`
`
`
`5
`The Second Circuit improperly altered that legis-
`lative balance by finding that one of these “safe har-
`bor” defenses, codified at 17 U.S.C. § 512(c), applies
`to pre-1972 sound recordings, even though those re-
`cordings gained none of the additional protection pro-
`vided in the DMCA or in the Copyright Act generally.
`In reaching this conclusion, the Second Circuit dis-
`carded the views of the Copyright Office on the mean-
`ing of the Copyright Act and ignored entirely the con-
`trary conclusion of the New York courts. See Escape
`Media Grp., 107 A.D.3d at 59 (agreeing with Copy-
`right Office that “Congress intended for the DMCA
`only to apply to post-1972 works”). Contrary to con-
`trolling precedent, e.g., Bond v. United States, 134 S.
`Ct. 2077, 2088-89 (2014), it interpreted a federal en-
`actment that says nothing about state-law preemp-
`tion as overriding state law—and did so even though
`Congress expressly and unequivocally gave primacy
`in this area to state law. See 17 U.S.C. § 301(c). And
`in conflict with decisions of this Court, the Second
`Circuit held that “the phrase ‘infringement of copy-
`right’ does include infringement of state laws of copy-
`right” (Pet. App.19a), even though it is “settled” that
`this phrase, as used in the Copyright Act, applies ex-
`clusively to violations of federal rights. See, e.g., Tele-
`prompter Corp. v. CBS, Inc., 415 U.S. 394, 398 n.2
`(1974) (citing 1 M. Nimmer, Copyright, § 100, at 376
`(1973)); Fortnightly Corp. v. United Artists Television,
`Inc., 392 U.S. 390, 395 n.10 (1968).
`The Second Circuit ran through all of these stop
`signs because of its desire to further “the purpose”
`that it thought the DMCA “was intended to achieve.”
`Pet. App. 21a. The signal flaw in that approach is
`that it failed to take seriously the policy choice that
`Congress made in 1971 and has reaffirmed multiple
`times since, including in the present text of section
`
`
`
`
`
`6
`301(c): Rights in pre-1972 sound recordings, and
`remedies for violations of those rights, are matters for
`the States to regulate and control. This Court should
`review and reverse the Second Circuit’s contrary de-
`cision.
`
`STATEMENT OF THE CASE
`1. The Parties. Petitioners are record and music
`publishing companies that produce, market, distrib-
`ute, and own hundreds of thousands of sound record-
`ings and music compositions. Capitol Records owns
`some of the most valuable sound recordings ever
`made. Many of them, including recordings by legend-
`ary artists like the Beach Boys, The Beatles, and Nat
`King Cole, were made prior to 1972. Capitol Records
`regularly licenses these recordings for use in audio-
`visual works, including motion pictures, television,
`and on the Internet.
`Respondents Vimeo, LLC and Connected Ventures,
`LLC (collectively, “Vimeo”) operate a website called
`Vimeo.com, to which users can upload videos which
`are then made available to the public by Vimeo. Pet.
`App. 9a. To populate its website, Vimeo encourages
`its users and employees to create videos and upload
`them to the site—including videos that use music
`owned by Capitol Records and others. Vimeo indexes
`its videos, organizes them into categories, inserts
`“metatags” identifying their content, and sells adver-
`tising which it places with the videos. Vimeo pro-
`motes its site as a destination for “creative” content
`and “original” works, and its employees “curate” the
`videos posted to the website, exercising unrestricted
`editorial control to remove or block viewing of content
`that
`they deem not
`“creative” or otherwise
`“Vimeoesque.” Br. for Pls.-Appellees-Cross-Appel-
`
`
`
`
`
`7
`lants at 6-7, Capitol Records v. Vimeo, 826 F.3d 78
`(2d Cir. 2007) (No. 14-1048) (ECF No. 113).
`While Vimeo polices its site to ensure that its users
`do not use copyrighted visual content, such as movie,
`television, or video game material, it does not make
`any effort to curb infringing use of audio content. Pet.
`App. 10a-11a. To the contrary, Vimeo encourages its
`users to include recorded music, including music
`owned by Petitioners, in their videos, and to do so
`without regard for the rights of the owners. Id. at
`11a. Vimeo employees are aware of this unauthorized
`use because, as the record shows, they review, inter-
`act with, and promote videos that use copyrighted
`music. Id. Vimeo employees, identifying themselves
`by name and as Vimeo “Staff,” have copied and used
`popular, commercial music, including music owned by
`Capitol Records, in videos that they personally make
`available on Vimeo.com to be viewed, copied, and dis-
`tributed. Id. at 103a-105a, 132a. And when users
`asked directly whether it was permissible to use cop-
`yrighted music, Vimeo employees responded with an-
`swers like “[d]on’t ask, don’t tell,” and “[w]e can’t offi-
`cially tell you that using copyright music is okay.
`But . . . .” Id. at 11a (first alteration in original).
`Through these activities, Vimeo.com has become
`one of the top ten online distributors of Internet vid-
`eo. As of 2015, Vimeo.com had 115 million videos in
`its database, which were viewed by 240 million users
`monthly. IAC Q3 2016 Shareholder Letter at 7 (Nov.
`2, 2016), http://ir.iac.com/results.cfm. At one time,
`Vimeo estimated that 10-20% of the videos on its
`website included unlicensed music. See Exh. 25 to
`Decl. of Russell J. Frackman at 25, Capitol Records,
`LLC, et al., v. Vimeo LLC, et al., 972 F. Supp. 2d 537
`(S.D.N.Y. 2013) (No. 09-cv-10101) (ECF No. 93-5).
`
`
`
`
`
`8
`2. Historical Background. Sound recording technol-
`ogy first emerged in the 19th century and became
`ubiquitous in American life early in the 20th century.
`Copyright Office Report at 7-8. Nonetheless, sound
`recordings did not become eligible for federal copy-
`right protection until the early 1970s. This circum-
`stance was not due to inattention on the part of Con-
`gress. At least 30 bills that would have extended fed-
`eral protection to sound recordings were introduced
`between 1925 and 1951 alone, and still others were
`introduced between 1951 and 1971. Id. at 9-10. But
`none passed, with one after another sunk by concerns
`about “technical deficiencies and concerns about their
`constitutionality,” as well as the competing economic
`interests of affected groups. Id.
`In the absence of federal protection, the States es-
`tablished significant property rights in sound record-
`ings and used statutory and common-law copyright
`and unfair competition laws, and even criminal stat-
`utes, to protect those rights. See generally S.A. Dia-
`mond, Sound Recordings and Phonorecords: History
`and Current Law, 1979 U. Ill. L.F. 337, 345-51; Copy-
`right Office Report at 36-48 (describing these statuto-
`ry and common law protections in California, Illinois,
`Michigan, New York, New Jersey, North Carolina,
`and other States).
`3. Congress Creates New Federal Rights But Pre-
`serves Existing State-Law Rights. In the early 1970s,
`prompted by escalating music piracy, by questions
`about whether federal copyright law had impliedly
`preempted state-law protections for sound recordings,
`and by a perception that new legislation would boost
`the nation’s position in upcoming treaty negotiations,
`Congress resolved to act. See Copyright Office Report
`at 11 (citing H.R. Rep. No. 92-487, at 2 (1971)). On
`November 15, 1971, Congress passed the Sound Re-
`
`
`
`
`
`9
`cording Amendment Act, which for the first time ex-
`tended federal copyright protection to sound record-
`ings. Pub. L. No. 92-140, § 1(a), 85 Stat. at 391. The
`statute’s grant of protection was explicitly prospec-
`tive—Congress mandated that the law “shall apply
`only to sound recordings fixed, published and copy-
`righted on and after the effective date” of the law, i.e.,
`February 15, 1972. Id. § 3, 85 Stat. at 392. And to
`rule out any argument that the statute had preempt-
`ed state law by implication, Congress declared that
`“nothing in [the Copyright Act] shall be applied ret-
`roactively or construed as affecting in any way any
`rights with respect to sound recordings fixed before”
`February 15, 1972. Id. This Court soon thereafter
`upheld state power to protect pre-1972 recordings
`against unauthorized uses, overruling, inter alia, a
`contention that Congress had impliedly preempted
`state laws by enacting copyright provisions that did
`not specifically address sound recordings. See Gold-
`stein v. California, 412 U.S. 546, 561-70 (1973). And
`in the course of its analysis, the Court specifically
`addressed section 3 of the Sound Recording Amend-
`ment Act, observing that the plain import of this pro-
`vision was that “Congress did not intend to alter the
`legal relationships which govern these [pre-1972] re-
`cordings.” Id. at 552.
`In 1976, Congress enacted the first comprehensive
`revision of federal copyright law since 1909. In doing
`so, Congress expressly reaffirmed its decision to re-
`serve exclusively to the States the protection and
`regulation of rights in pre-1972 sound recordings.
`Specifically, the 1976 Act provided:
`With respect to sound recordings fixed before
`February 15, 1972, any rights or remedies under
`the common law or statutes of any State shall
`not be annulled or limited by this title until Feb-
`
`
`
`
`
`10
`ruary 15, 2047. . . . Notwithstanding the provi-
`sions of section 303, no sound recording fixed be-
`fore February 15, 1972, shall be subject to copy-
`right under this title before, on, or after Febru-
`ary 15, 2047.
`Pub. L. No. 94-553, § 301(c), 90 Stat. 2541, 2572
`(1976).
`In 1998, Congress again confirmed its decision to
`preserve exclusive state jurisdiction over pre-1972
`sound recordings. It did so by extending the sunset
`date for exclusive state governance by 20 years, to
`February 15, 2067. See Pub. L. No. 105-298, § 102(a),
`112 Stat. 2827, 2827 (1998) (codified at 17 U.S.C.
`§ 301(c)).
`4. The Digital Millennium Copyright Act. One day
`after reaffirming and extending the exclusive state
`jurisdiction over pre-1972 sound recordings, Congress
`enacted the DMCA. Contrary to the Second Circuit’s
`subsequent conclusion that this statute limits previ-
`ously exclusive state-law rights and remedies, the
`DMCA did not say even a single word about the just-
`extended state sovereignty over pre-1972 sound re-
`cordings. Nor did it say anything about preempting
`state law. The DMCA, rather, sought to protect copy-
`right owners by addressing and correcting “the ease
`with which pirates could copy and distribute a copy-
`rightable work
`in digital
`form,”
`including by
`“back[ing] with legal sanctions the efforts of copyright
`owners to protect their works from piracy behind dig-
`ital walls such as encryption codes or password pro-
`tections.” Microsoft, 550 U.S.at 458. In addition, the
`DMCA grants “copyright owner[s]” certain new rights
`to protect against infringement.1 For example, “copy-
`
`1 In the Copyright Act, “‘[c]opyright owner,’ with respect to
`any one of the exclusive rights comprised in a copyright, refers
`
`
`
`
`11
`right owners” may obtain a subpoena compelling a
`service provider to identify individuals who engage in
`infringing activities using the service provider’s facil-
`ities. 17 U.S.C. § 512(h).
`In exchange, the DMCA created new limitations on
`infringement liability for internet service providers.
`See id. § 512(a)-(d). These four limitations, or “safe
`harbors,” cover a range of provider activities, includ-
`ing transitory communications, system caching, stor-
`ing information at users’ direction, and information
`location tools. Where applicable, these safe harbors
`preclude awards of monetary or injunctive relief. Id.
`This case concerns one of those four safe harbors.
`The safe harbor defense set forth in section 512(c)
`shields service providers against liability “for in-
`fringement 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.” Id. § 512(c)(1). Providers must sat-
`isfy a series of criteria to qualify for this protection.
`They must not have “actual knowledge” that infring-
`ing materials are being stored. Id. § 512(c)(1)(A)(i).
`They also cannot have been “aware of facts or circum-
`stances from which infringing activity is apparent.”
`Id. § 512(c)(1)(A)(ii). If they obtain such knowledge or
`awareness, they must “act[] expeditiously to remove,
`or
`disable
`access
`to,
`the material.”
`Id.
`§ 512(c)(1)(A)(iii). They may 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.” Id. § 512(c)(1)(B).
`And if they receive a “notification of claimed in-
`
`
`to the owner of that particular right.” 17 U.S.C. § 101. These
`exclusive federal rights are enumerated in 17 U.S.C. § 106.
`
`
`
`
`12
`fringement,” see id. § 512(c)(3), they must “respond
`expeditiously” to the notification, id. § 512(c)(1)(C).
`5. The Copyright Office Report. In 2009, Congress
`directed the Copyright Office to conduct a two-year
`study, upon notice and comment, “on the desirability
`of and means for bringing sound recordings fixed be-
`fore February 15, 1972, under federal jurisdiction.”
`See 2 Omnibus Appropriations Act, 2009, supra, at
`1769; 155 Cong. Rec. H2397 (daily ed. Feb. 23, 2009).
`Congress further directed that the study should “cov-
`er the effect of federal coverage on the preservation of
`such sound recordings, the effect on public access to
`those recordings, and the economic impact of federal
`coverage on rights holders.” 2 Omnibus Appropria-
`tions Act, 2009, supra, at 1769.
`The Copyright Office Report, entitled “Federal Cop-
`yright Protection for pre-1972 Sound Recordings,”
`was released in December 2011. The Report began
`from the premise that Congress “exclude[ed] pre-1972
`sound recordings from federal protection.” Copyright
`Office Report at 83. It analyzed in depth the potential
`costs and benefits of bringing pre-1972 sound record-
`ings under federal dominion for the first time. Among
`the Copyright Office’s recommendations was that
`state-law rights holders should be compensated ap-
`propriately for any deprivation of vested rights that
`federalization might entail. Id. at 155-56. It acknowl-
`edged that the music industry had “come to rely” on
`“over a hundred years of a state-law regime,” mean-
`ing that “while federal protection for pre-1972 sound
`recordings migh
Accessing this document will incur an additional charge of $.
After purchase, you can access this document again without charge.
Accept $ Charge
Still Working On It
This document is taking longer than usual to download. This can happen if we need to contact the court directly to obtain the document and their servers are running slowly.
Give it another minute or two to complete, and then try the refresh button.
A few More Minutes ... Still Working
It can take up to 5 minutes for us to download a document if the court servers are running slowly.
Thank you for your continued patience.
This document could not be displayed.
We could not find this document within its docket. Please go back to the docket page and check the link. If that does not work, go back to the docket and refresh it to pull the newest information.
Your account does not support viewing this document.
You need a Paid Account to view this document. Click here to change your account type.
Your account does not support viewing this document.
Set your membership
status to view this document.
With a Docket Alarm membership, you'll
get a whole lot more, including:
- Up-to-date information for this case.
- Email alerts whenever there is an update.
- Full text search for other cases.
- Get email alerts whenever a new case matches your search.
One Moment Please
The filing “” is large (MB) and is being downloaded.
Please refresh this page in a few minutes to see if the filing has been downloaded. The filing will also be emailed to you when the download completes.
Your document is on its way!
If you do not receive the document in five minutes, contact support at support@docketalarm.com.
Sealed Document
We are unable to display this document, it may be under a court ordered seal.
If you have proper credentials to access the file, you may proceed directly to the court's system using your government issued username and password.
Access Government Site
