Appeals Court: Copyright Owners Must Consider Fair Use Before Sending Takedowns

The opinion results from the removal of a video showing a toddler dancing to a Prince song.
Courtesy Everett Collection

If copyright owners don't consider fair use before sending a takedown, they can get in trouble for misrepresentation. On Monday, the Ninth Circuit Court of Appeals made this clear in a long-awaited opinion in a dispute concerning a 29-second video clip of a toddler dancing to the 1984 Prince hit "Let's Go Crazy."

In 2007, after Stephanie Lenz posted the clip, Universal Music told YouTube to remove it for allegedly violating publishing rights on the Prince song. The takedown sparked an outcry from those who believed that background music in a cute baby video wasn't a violation of the music giant's rights. The Electronic Frontier Foundation subsequently represented Lenz in a lawsuit against Universal for allegedly violating §512(f) of the Digital Millennium Copyright Act.

On appeal, Universal drew support from the Motion Picture Association of America and the Recording Industry Association of America with arguments that fair use is merely an affirmative defense to a copyright lawsuit while Lenz's side gathered amici backing from such companies as Google, Twitter and Tumblr. These tech companies aimed to impose larger burdens on copyright owners demanding takedowns.

The Ninth Circuit reviewed a district court's denial of summary judgment.

According to the opinion from circuit judge Richard Tallman, "Even if, as Universal urges, fair use is classified as an 'affirmative defense,' we hold — for the purposes of the DMCA — fair use is uniquely situated in copyright law so as to be treated differently than traditional affirmative defenses. We conclude that because 17 U.S.C. § 107 created a type of non-infringing use, fair use is 'authorized by the law' and a copyright holder must consider the existence of fair use before sending a takedown notification under § 512(c) ... "

The federal appellate court also examined whether there was a genuine issue of material fact as to whether Universal knowingly misrepresented that it had formed a good faith belief the "dancing toddler" video did not constitute fair use. The music company argued that the employee who had seen the video had weighed certain factors like the amount and substantiality of the use of the copyrighted work before sending a takedown notice. The question brought to the appeals court thus amounted to what kind of mind frame is necessary in evaluating fair use.

Here, copyright owners fare better as the Ninth Circuit rejects Lenz's argument to an objective standard on a fair use determination.

"To be clear, if a copyright holder ignores or neglects our unequivocal holding that it must consider fair use before sending a takedown notification, it is liable for damages under § 512(f)," writes Tallman. "If, however, a copyright holder forms a subjective good faith belief the allegedly infringing material does not constitute fair use, we are in no position to dispute the copyright holder’s belief even if we would have reached the opposite conclusion," writes Tallman.

Tallman says it's up to a jury to "determine whether Universal’s actions were sufficient to form a subjective good faith belief about the video’s fair use or lack thereof."

But the judge also adds that copyright owners need to do more than pay "lip service" to fair use, and further, that the "willful blindness doctrine" can be applicable to these type of disputes if a copyright owner deliberately avoids learning of fair use despite high probabilities.

In this instance, though, the appeals court says that Lenz failed to show that Universal was aware of a high probability that the video constituted fair use, and so she can't proceed to trial against the defendant on a "willfull blindness" theory.

However, Lenz will get to trial anyway. And it's one in which she can win damages. The opinion rejects Universal's argument that she had to demonstrate actual monetary loss from copyright misrepresentation.

Before the case gets to trial, though, it wouldn't be a shocker to see the parties further delay the ultimate outcome of this case with a bid for a Supreme Court review. This case has never been solely about just one situation — a "dancing baby" video. It's lasted more than eight years because the litigants are hoping to shape copyright law. As such, a high court review is definitely a possibility.

In the meantime, here's the opinion that also offers some guidance on such issues as whether use of computer algorithms to find illicit use of copyrighted material online would satisfy the need to consider fair use. The MPAA is happy about this part.

"While we disagree with aspects of the Ninth Circuit’s opinion, we are pleased that it recognized that a copyright owners’ use of automated processes to identify infringements would appear to be a ‘valid and good faith’ means of satisfying the requirements of the DMCA, including any requirement to consider fair use,"  says the studio trade association in a statement. "As the court acknowledged, copyright owners face a ‘pressing crush of voluminous infringing content,’ and the law must not be read to ‘jeopardize a copyright owner’s ability to respond rapidly to potential infringements.’”

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