6:39pm PT by Austin Siegemund-Broka
YouTube Networks Sue Music Service For "Copyright Trolling"
"Copyright troll" is a term used to describe entities that make their money by claiming that content producers or other companies are infringing on their copyrights. It's what two of the biggest YouTube producers, Machinima and Collective Digital Studio, call the music service Freeplay in a pair of new lawsuits.
The complaints, nearly identical and both filed by Freedman & Taitelman's Bryan Freedman in California federal court on Monday, claim that Freeplay extorts YouTube video creators with a "bait and switch" business model.
The producers claim that Freeplay offers producers free music for YouTube videos, then demands "outrageous" license fees when video producers use its music. They say Freeplay then sends a "shakedown demand" threatening litigation and demanding more payments. But it doesn't identify the songs it claims infringe its copyrights, the producers say.
"This is NOT how a business that wishes to legitimately license and protect its content would behave," read the two complaints. "But Freeplay is not really in the content license business. Freeplay conducts its business in a very different manner — a 'bait and switch' followed by extortion."
Machinima, which describes itself as a "many to many" service instead of a multichannel network, and Collective Digital Studio produce their own content and partner with other popular YouTube producers, with Machinima boasting over 30,000 programmers and CDS over 600 channels.
In October 2014, their YouTubers began receiving monetary demands for music from Freeplay. But the networks themselves did too, though they had "never subscribed to Freeplay's service, downloaded Freeplay's music, or otherwise agreed to any of Freeplay's terms and conditions," they claim.
The demands typically come from a different company, TuneSat, "ostensibly a third party 'monitoring' the web for supposed infringement on behalf of Freeplay." But the complaints point out that TuneSat and Freeplay were founded by and have the same CEO, Scott Schreer.
Machinima and CDS have sued for violations of California's unfair competition laws. "Consumers, including struggling artists and musicians, drawn to Freeplay by the promise of 'free' music, generally lack the financial wherewithal to seriously challenge Freeplay's shakedown tactics," read the complaints.
The YouTube producers accuse Freeplay of "exploiting deceptive business practices through the operation and marketing of its highly interactive website." They're also asking for the court to declare that they and their YouTubers have not infringed on Freeplay's copyrights.
Freeplay's attorney, Oren Warshavsky at BakerHostetler, tells The Hollywood Reporter, "We are preparing a response that will clearly demonstrate that the allegations and characterizations in the complaints are baseless. Freeplay intends to zealously protect its rights and reputation and is committed to doing the same for the artists it represents."
Feb. 11, 4:15 p.m. Updated with comment from Freeplay's lawyer.