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Viacom, Google Face Off in Appeals Court Over YouTube Copyright Issues

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Viacom, Google, and a class of copyright holders led by the UK Premier League squared off Tuesday before a three-judge panel at the 2nd Circuit Court of Appeals in a case that will shape the future of the Internet by determining the standard for copyright liability. 

The parties not only presented distinct world-views of their interpretation of relevant statutory language, but debated "knowledge" almost as if one side was reading from Plato and the other from Ludwig Wittgenstein. The gulf between the two camps is that enormous.

Up first was Paul Smith, chair of the appellate practice at Jenner & Block, arguing on Viacom's behalf that YouTube willfully blinded itself to more than 60,000 copyrighted works like clips from The Daily Show with Jon Stewart and BET content illegitimately posted on the video-sharing website.

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In opening remarks, Smith called a decision by U.S. District Court Louis Stanton to dismiss Viacom's billion-dollar lawsuit against YouTube "indefensible." If left to stand, Smith argued that it would nullify three statutory obligations by ISPs like YouTube: First, to act expeditiously if a company gains knowledge of copyrighted material on its network. Second, there would be no preventing online companies from deriving direct financial benefit off the back of copyrighted material. And third, there would be no stopping sites like YouTube from storing infringing materials at the behest of their users.

During questioning from the appellate judges, Smith got some push-back on whether Viacom was merely asserting YouTube had "abstract" knowledge of copyright infringing material. The judges wanted to know whether this would be enough to satisfy its burdens in pushing the case.

Viacom has long argued that general knowledge of infringement is as good as actual knowledge in forcing ISPs to act expeditiously, but here Smith largely eschewed direct talk about "red flags."

Instead, he (as well as the lawyer representing the class plaintiffs) approached the issue more practically, hitting hard on the point that the e-mails and other documented evidence from the case showed that whatever standard of knowledge was picked, it was more than sufficient to bring the case before a jury.

"The founders of YouTube were one of the 10 most frequent users of the website," said Smith, adding, "They deliberately hid from their own eyes what was going on."