U.S. Judge Tosses Suit Over Hosted Pirated Content

Sep 14, 2009 5:00 PM PST
LOS ANGELES — A federal judge on Monday ruled that the Digital Millennium Copyright Act's safe-harbor provisions protected Veoh Networks from liability for hosting pirated clips uploaded by users.

U.S. District Court Judge A. Howard Matz, who granted Veoh’s motion for summary judgment in a copyright infringement lawsuit brought by Universal Music Group, said that the DMCA “does not place the burden of ferreting out infringement on the service provider.”

The 29-page order said that he found Veoh’s policy on terminating repeat offenders who post pirated material satisfies Congress’ intent that “those who repeatedly or flagrantly abuse their access to the Internet through disrespect for the intellectual property rights of others should know that there is a realistic threat of losing that access.”

Universal sued Veoh for copyright infringement in 2007, alleging that Veoh was wrongly hosting pirated music videos. Universal alleged that the site was "a massive copyright infringer that has built its business on the back of others' intellectual property."

Veoh argued that it took steps aimed at preventing pirated clips from appearing on the site, including using filtering technology. It also said that it removed clips upon request, as per the DMCA's safe harbor provisions.

Universal said that Veoh wasn't eligible for the safe-harbor provisions of the DMCA because the company's founders, employees and investors knew of widespread infringement.

The case relied much on a 9th U.S. Circuit Court of Appeals ruling in Perfect 10 vs. CCBill, where the court evaluated the “reasonableness” of the defendants’ termination policies.

That ruling, involving an adult content company and a third-party payment processor, set forth the standard for evaluating termination policies under the DMCA.

“The [9th Circuit] held that Perfect 10’s notices of infringement did not provide a valid basis for terminating users, even though they identified specific infringing works, because they did not contain declarations under penalty of perjury that the complainant was authorized to represent the copyright holder and that he had a good-faith belief that the user was infringing,” the court said.

The decision marked the second major courtroom victory for Veoh. Last year, Veoh was victor in a similar copyright lawsuit brought by Titan Media's parent, the Io Group.

In a statement, Universal said it intends to appeal the Veoh ruling.

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