DMCA: The Porn Industry’s Worst Nightmare

Jul 18, 2012 4:00 PM PST

LOS ANGELES — For porn studios, no law pertaining to intellectual property rights seems more inequitable than the U.S. Digital Millennium Copyright Act (DMCA).

Passed by Congress 14 years ago, the DMCA attempted to stamp out online copyright infringement while harmonizing its approach with international laws — laws which often cast a callously indifferent eye upon the need for protecting the copyrights of U.S. companies.

While the DMCA sought to redress the problem of content piracy, persistent infringers have found ways of exploiting provisions within the law to remain operating under a fraudulent veneer of legitimacy. Principal among these loopholes is what is known as the “safe harbor” provision, which includes the ability of user-generated content (UGC) sites to claim DMCA compliance if they remove any infringing content upon demand. This has become a vehicle for infringers to flourish over the web, with UGC websites depending on these safe harbor protections that are essential to the survival of their business model, as well as to their ability to continue operating.

This apparently impenetrable shield of immunity for operators that the DMCA provides has led to explosive growth among piracy-fueled websites — such as tube sites offering UGC — some of which play a continuous cat-and-mouse game of posting, taking down upon demand, and then later re-posting, poached content.

Indeed, in the span of less than four years, countless tube sites have launched, streaming thousands upon thousands of porn clips, entire movies included, that have been uploaded by users, or sometimes, in the most legally egregious cases, by the tube site operators themselves. These tube sites receive incredible amounts of traffic, which are monetized in various ways, churning large enough chunks of change to tempt prospective pirates, many of whom operate far from U.S. shores — where a dollar can travel further, and the need for any income, may be direr.

Beyond tube sites, bit torrents and file lockers, among other technologies, are all abused by wanton copyright infringers, usually in an effort to sell advertising space on their sites and to upsell users on premium memberships that allow more and faster downloads of stolen material.

In the latter case, allegedly infringing file locker sites that host entire libraries of stolen porn content for free, are currently under attack — with rights holders pressuring payment processors to pull their services from these sites, based not upon any violation of law but upon breaches of the processor’s stated acceptable use policies.

This approach illustrates the often superior efficacy of stakeholder-sponsored initiatives over clumsily crafted legislation when dealing with a target as dynamic as commercial online piracy.

For example, one shady scenario involves a company that knowingly and willingly submits infringing content to its tube site — or pays others to do it for them — under the guise of “user” uploads. Then in an effort to seemingly comply with the DMCA, removes clips on request — only to have the compliance department send the removed material to the upload department, where this cynically cyclical process is endlessly repeated.

A UGC site with a repeat offender (whether a “real” user or spurious staffer) that is required to terminate that user’s account, will only see user John_123 quickly come back as John_124 or under some other bogus identifier or “nick” (short for “nickname”). The signup process’ relative anonymity prevents any effective due-diligence — even by those UGC sites that may be actually interested in keeping infringing content uploads at bay — a major DMCA weakness.

Add in the layers of legal complexity and the practical inability of enforcement efforts that are imposed by the global nature of the online ecosystem, and the process quickly favors pirates.

This situation has resulted in phrases aimed at the DMCA from “half-baked” to “fucked up” that are echoed by the porn industry and by the contingent of attorneys who represent its content owners, marketers and producers.

According to XBIZ Founder and President Alec Helmy, the DMCA as it applies to the adult entertainment industry has done more to sustain rampant content piracy than to stem it.

“Its failure is evident in the prevalence of pirated porn throughout the Internet, not to mention, tanking industry revenues,” Helmy stated. “Given that much of the industry’s piracy problem stems from user-generated content, I believe the onus is on the UGC sites to address DMCA’s shortcomings by adopting industry-specific policies and operating proactively rather than reactively.”

Helmy cites the suggestions made during a recent XBIZ conference, where one step forward would be to pre-qualify those who upload commercial content before their submitted material is made available for public viewing.

“The first UGC site to spearhead such changes stands to gain tremendous goodwill.” Helmy added.

So, how could a law that was intended to protect, go so wrong?

Greg Piccionelli, a tech-savvy adult entertainment industry attorney who specializes in intellectual property matters, said that Congress sought to strike a balance between the protection of valuable intellectual property rights on one hand, and the protection of freedom of expression on the other — a task that as embodied in the DMCA, it “failed miserably” at.

 “Interestingly, and uncharacteristically, I believe [Congress] failed by erring on the side of individual freedom over monetary interests,” Piccionelli told XBIZ. “But however laudable that might be, it doesn’t change the fact that the DMCA, in my opinion, is a half-baked attempt to address the challenges that result when 21st century technology collides with ancient notions of property rights.”

Piccionelli explained that one of Congress’ DMCA failing points is that it simply did not put into place any appropriate administrative or judicial means for infringed content owners wanting to quickly and cost effectively obtain the identity of infringers. 

“The resulting situation can hardly be characterized as an effective balance between property and expression interests,” Piccionelli said. “On the contrary, the deck is clearly stacked against intellectual property owners in favor of infringers. This predicable outcome has resulted in the inevitable creation and proliferation of online business models that are literally built on, if not wholly dependent on, infringement.”

This is an area where the DMCA falls short: while it may have served the interests of major producers hoping to keep erroneous copies of Disney titles off of YouTube, it did not envision legions of third world pirates, spending their days in Internet cafes uploading stolen porn clips, as part of a “get paid based on the number of downloads your clip receives” affiliate program.

“What people need to understand is that this is not ‘sharing is caring’ nonsense, this is big business,” said Mike South, who runs blog site MikeSouth.com. “When you pay people to upload copyrighted content like the tubes and the file lockers do, it is purely a criminal enterprise to steal and profit from intellectual property.”

South, also producer and site owner of SouthernBukkake.com and StripperFacials.com, is typical of porn producers who are fed up with shortcomings in the DMCA.

“[The] bottom line is that you can pass a law, but if it can’t realistically be enforced it won’t be much of a deterrent,” South told XBIZ. “If you look at the file lockers, for instance, most of them do not delete the content. They simply delete the links to the content, so new links can be generated within a few seconds without having to reload the content. That is a direct violation of the DMCA.”

Coping with piracy problems is all part of the cat-and-mouse game that is a familiar theme to legitimate content owners attempting to protect their property from infringement, with the use of takedown notices becoming a primary but not sole entrant in the rights holder’s toolbox.

Pink Visual President Allison Vivas told XBIZ that DMCA takedown notifications have always been just one tool for copyright holders to use — not a complete solution for deterring or preventing infringement in any content-driven industry, porn or Hollywood.

“It’s also a tool that rights-holders need to understand when and how to use, in order to make effective use of other elements of copyright law to enforce their intellectual property rights,” Vivas commented. “It’s also true that there are several prerequisites that have to be satisfied before a user-generated content site is eligible to receive safe harbor under the DMCA, so there is more to compliance than taking down content in response to a take-down notice — something I think the adult entertainment industry as a whole was a bit slow to realize.”

Part of this need for continuing education on the subject is the realization that for consumers, the consumption of free porn via tube and file locker sites has some tangible advantages, explains Doug Lichtman, a UCLA professor who focuses his teaching and research on topics that relate to law and technology.

“The biggest challenge for adult content,” Lichtman told XBIZ, “is the reality that pirated material is ironically better than legitimate material. To access legitimate material, a user has to identify himself by subscribing and paying,” Lichtman said. “[Accessing] pirated material, by contrast, can be fully anonymous.”

In an age of rampant identity theft and global concerns over censorship, the importance of this factor shouldn’t be underestimated.

“That disparity exerts enormous pressure on the market,” Lichtman explained, noting that this influence “distinguishes adult content from other forms of vulnerable content, where piracy has been at least partially displaced by the provision of high-quality, consumer-friendly legitimate content.”

Faced with this, many adult entertainment companies are seeking an alternative method of addressing lost revenues and brand confusion; such as high-profile lawsuits designed to put pressure on piracy scofflaws — including suits pursuing individual downloaders who may be difficult to personally identify due to restrictions within the DMCA.

Chad Belville, an industry attorney who has represented scores of adult entertainment companies in piracy cases, puts his views squarely on the table.

“The DMCA is one of the most fucked up pieces of legislation affecting the industry, second only to the labyrinth of 2257,” said Belville, who has filed dozens of suits against tube sites on behalf of Private Media Group’s Fraserside unit, Kink.com and Zero Tolerance.

“The DMCA had good intentions,” Belville told XBIZ. “But in the real world, it makes enforcement of copyright more difficult by giving some cover and defense to operators that are intentionally infringing on the hard work of legitimate producers.”

As for finding a solution, Piccionelli says that there needs to be more work done on DMCA, in order to shore up all of the dents and bruises it has inflicted on the porn biz.

“The only thing more shameful and disgraceful than Congress’ half-baked passage of the DMCA is its failure to address its shortcomings after more than a decade,” Piccionelli said.

Recent court decisions, however, could signal an impending change for the DMCA.

The 2nd U.S. Circuit Court of Appeals recently rendered what may be a crucial decision in the long-running Viacom vs. YouTube lawsuit — a decision that may impact DMCA’s future. While the 2nd Circuit sent much of the case back to a New York trial court for more litigation, many portions of its recent decision, such as those concerning the knowledge required to find copyright infringement, may have consequences for UGC sites, including tubes and file lockers.

For example, the 2nd Circuit vacated a lower court’s order finding that YouTube needed to have item-specific actual knowledge of infringement in order to have the “right and ability” to control infringing content. With the decision, the 2nd Circuit opened the door for operators who know that some infringement occurs on their site, but then claim not to know which specific files are infringing, to be held liable for that infringement — regardless of their level of knowledge.

Because the 2nd Circuit remanded a substantial portion of the case to the federal court in New York, the Viacom case is still far from done. 

“For the time being, however, one of the leading decisions suggesting that user-generated content service operators could not be liable for copyright infringement without item-specific knowledge of infringement has been vacated,” attorney J. Malcolm DeVoy of Randazza Legal Group recently wrote in an article on the suit.

“Although the trend for tube sites over the last several years has been to comply with the DMCA and license content, the standard for complying with the DMCA will likely increase with this decision,” DeVoy stated. “Simultaneously, content owners who seek to hold sites liable for infringement may have a means to do so if they can show service operators had some knowledge of infringement — even if it was not item-specific.”

The upshot is that a UGC site owner who knows one video clip was pirated should assume that all of them are pirated, and take systemic actions accordingly. Of course, this shifts the onus of copyright enforcement to site owners, while turning the presumption of innocence over into a presumption of guilt; a move that American lawmakers may find unconstitutional to implement.

But those issues will likely be decided by an army of attorneys, with any overall net benefit to copyright holders far from certain. One thing that is for certain, however, is that the DMCA is not effective at protecting the rights of American media businesses — porn studios included.

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