(C): Notice & Take Down Pt. 2

by Howie Cockrill

In Part 1 of this article, I outlined the 4 types of Online Service Providers (OSPs) that qualify for protection under the DMCA and the 3 types of infringement liability.

I also explained the concept of "strict liability."

In Part 2, I discuss the "contributory" and "vicarious" infringement liability and explore the notion of no liability for copyright infringement. 

CONTRIBUTORY LIABILITY

Direct infringement refers to an individual’s unauthorized use of copyrighted material. 

Courts also recognize “secondary infringement” in the form of contributory and vicarious infringement. 

There are 2 important points to note about both contributory liability and its cousin, vicarious liability:

The first point is that these are judge-made doctrines and cannot be found in copyright statutes.  This means that they can be altered, added to or taken away from more easily that statutory law. 

The second point is that there must be a direct infringement before contributory or vicarious liability can apply.  In other words – if there is no direct infringer, there can be NO contributory or vicarious infringer.

To be liable for contributory infringement, there are 2 elements:

1. Knowledge:  the OSP “knew or should have known” of the direct infringement
2. Assistance:  the OSP “materially contributed to” the infringement

The 1995 Netcom case mentioned in Part 1 stated that an Online Service Provider does not have “knowledge of the infringement” if the OSP cannot verify the infringement claim:

1. because the infringement is a possible fair use,
2. because there were no copyright notices on the infringed material, or
3. because the copyright owner failed to show evidence of the infringement. 

Thus, the OSP must be given notice that an infringement is occurring on his or her website. 

Unless notice is given, the OSP can have no knowledge. Without knowledge, the OSP cannot be liable for contributory infringement. 

Once notice has been given, all bets are off – a process has been set in motion, and the OSP may be held contributorily liable, depending on the situation.

As for “material contribution,” there is no hard and fast rule – courts have to look at the particular facts of each case and compare those to how courts have ruled previously in both online and offline contributory infringement cases. 

Why am I focusing so much on this Netcom case? 

Because the holding from Netcom in many ways led to Congress passing the OCILLA (Online Copyright Infringement Liability Limitation) Act, which then became Section 512 of the DMCA.

The DMCA Section 512 is discussed in detail below.

VICARIOUS LIABILITY

To be held vicariously liable, the following 2 elements must be proven:

1.    Control:  the OSP had the right and ability to control the infringer’s acts and
2.    Financial Benefit:  the OSP received direct financial benefit from the infringement.

Note that there is no “knowledge” requirement for vicarious liability.  In that way, it is similar to strict liability. 

Let’s take a moment to distinguish vicarious liability from contributory liability. 

Remember that contributory liability requires knowledge of and material contribution to the infringement. 

Vicarious liability, on the other hand, requires a right and ability to supervise the direct infringer and direct profit from the infringement.

In short:

1. Contributory infringement is a failure to stop your own actions which facilitate direct infringement.
2. Vicarious infringement is a failure to stop a third party from direct infringement. 

One key piece in proving “right and ability to control” is the “Terms of Use” on an OSP's website. 

Terms of Use that give an OSP power to accept, reject, take down, restore or otherwise screen material uploaded by its users may expose the OSP to vicarious liability. 

Note that a single OSP can be held liable for either contributory or vicarious infringement, or the OSP can be held liable for both contributory and vicarious infringement.

For example, in the 1995 Netcom case mentioned above, Netcom was found contributorily liable because it had knowledge of direct infringement and it materially participated in the infringing activity.

However, Netcom was not held vicariously liable because, even though it had the right and ability to control its users’ activities, it could not be proven that Netcom received direct financial benefit from the infringement.

Alternatively, in the 2001 Napster case, Napster was held liable as both a contributory and vicarious infringer.

Contributory because the court found that Napster had knowledge of infringements on its service and that Napster materially contributed to the infringements. 

Vicarious because the court found that Napster reaped financial benefits from the infringements, because the ability to infringe acted as a draw for new customers, and that Napster had the right and ability to control certain aspects of the infringements. 

NO LIABILITY

It should be noted that neither the courts nor Congress have considered “no liability” as an option for internet intermediaries. 

Why is this?

Many would assert it is due in part to successful lobbying by major music and film corporations. 

The music and film corporations argue that if OSPs cannot be held liable at all for their users’ copyright infringement, this will lead to rampant violations of copyright online. 

This in turn would result in content providers refusing to make their content available online.  And of course, ultimately it is the public that loses in this scenario.

Another argument against “no liability for OSPs” is that without the possibility of contributory or vicarious liability hanging over their heads – OSPs would have no incentive to discourage direct infringers.  In fact, OSPs may in fact encourage direct infringers. 

Also, pursuing individual direct infringers is a costly and often inefficacious endeavor.  There are simply too many individual direct infringers and they are too hard to find. 

Finally, from a PR perspective, it does not look good to sue the little guys (though many copyright owners do so anyway).  It often looks better to sue the larger intermediaries.

Check back with MELON for Part 3 of this article in which I provide a detailed explanation of DMCA Section 512 - the "notice and take down" provision.