On Policy and Plain Meaning in Copyright Law

As noted in my last post, there have been several important copyright decisions in the last couple months. I want to focus on two of them here: Viacom v. YouTube and UMG v. Escape Media. Both relate to the DMCA safe harbors of online providers who receive copyrighted material from their users – Section 512 of the Copyright Act. Their opposing outcomes illustrate the key point I want to make: separating interpretation from policy is hard, and I tend to favor following the statute rather than rewriting it when I don’t like the policy outcome. This is not an earthshattering observation – Solum and Chiang make a similar argument in their article on patent claim interpretation. Nevertheless, I think it bears some discussion with respect to the safe harbors.

For the uninitiated, 17 U.S.C. 512 states that “service providers” shall not be liable for “infringement of copyright” so long as they meet some hurdles. A primary safe harbor is in 512(c), which provides exempts providers from liability for “storage at the direction of a user of material that resides on a system” of the service provider.

To qualify, the provider must not know that the material is infringing, must not be aware of facts and circumstances from which infringing activity is apparent, and must remove the material if it obtains this knowledge or becomes aware of the facts or circumstances. Further, if the copyright owner sends notice to the provider, the provider loses protection if it does not remove the material. Finally, the provider might be liable if it has the right and ability to control the user activity, and obtains a direct financial benefit from it.

But even if the provider fails to meet the safe harbor, it might still evade liability. The copyright owner must still prove contributory infringement, and the defendant might have defenses, such as fair use. Of course, all of that litigation is far more costly than a simple safe harbor, so there is a lot of positioning by parties about what does and does not constitute safe activity.

This brings us to our two cases:

Viacom v. YouTube

This is an old case, from back when YouTube was starting. The district court recently issued a ruling once again finding that YouTube is protected by the 512(c) safe harbor. A prior appellateruling remanded for district court determination of whether Viacom had any evidence that YouTube knew or had reason to know that infringing clips had been posted on the site. Viacom admitted that it had no such evidence, but instead argued that YouTube was “willfully blind” to the fact of such infringement, because its emails talked about leaving other infringing clips on the site – just not any that Viacom was alleging. The court rejected this argument, saying that it was not enough to show willful blindness as to Viacom’s particular clips.

The ruling is a sensible, straightforward reading of 512 that favors the service provider.

UMG v. Escape Media

We now turn to UMG v. Escape Media. In a shocking ruling yesterday, the appellate division of the NY Supreme Court (yeah, they kind of name things backward there) held that sound recordings made prior to 1972 were not part of the Section 512 safe harbors. Prior to 1972, such recordings were not protected by federal copyright. Thus, if one copies them, any liability falls under state statute or common law, often referred to as “common law copyright.”  Thus, service providers could be sued under any applicable state law that protected such sound recordings.

Escape Media argued that immunity for “infringement of copyright” meant common law copyright as well, thus preempting any state law liability if the safe harbors were met.

The court disagreed, ruling that a) “copyright” meant copyright under the act, and b) reading the statute to provide safe harbors for common law copyright would negate Section 301(c), which states that “any rights or remedies under the common law or statutes of any State shall not be annulled or limited by this title until February 15, 2067.” The court reasoned that the safe harbor is a limitation of the common law, and thus not allowed if not explicit.

If this ruling stands, then the entire notice and takedown scheme that everyone relies on will go away for pre-1972 sound recordings, and providers may potentially be liable under 50 different state laws. Of course, there are still potential defenses under the common law, but doing business just got a whole lot more expensive and risky to provide services. So, while the sky has not fallen, as a friend aptly commented about this case yesterday, it is definitely in a rapidly decaying orbit.

Policy and Plain Maining

This leads to the key point I want to make here, about how we read the copyright act and discuss it. Let’s start with YouTube. The court faithfully applied the straightforward language of the safe harbors, and let YouTube off the hook. The statute is clear that there is no duty to monitor, and YouTube chose not to monitor, aggressively so.

And, yet, I can’t help but think that YouTube did something wrong. Just reading the emails from that time period shows that the executives were playing fast and loose with copyright, leaving material up in order to get viewers. (By they way, maybe they had fair use arguments, but they don’t really enter the mix). Indeed, they had a study done that showed a large amount of infringement on the site. I wonder whether anyone at YouTube asked to see the underlying data to see what was infringing so it could be taken down. I doubt it.

I would bet that 95% of my IP academic colleagues would say, so what? YouTube is a good thing, as are online services for user generated content. Thus, we read the statute strictly, and provide the safe harbor.

This brings us to UMG v. Escape Media. Here, there was a colossal  screw-up. It is quite likely that no one in Congress thought about pre-1972 sound recordings. As such, the statute was written with the copyright act in mind, and the only reasonable reading of the Section 512 is that it applies to “infringement of copyright” under the Act. I think the plain meaning of the section leads to this conclusion. First, Section 512 refers to many defined terms, such as “copyright owner” which is defined as an owner of one of the exclusive rights under the copyright act. Second, the copyright act never refers to “copyright” to refer to pre-1972 sound recordings that are protected by common law copyright. Third, expanding “copyright” elsewhere in the act to include “common law copyright” would be a disaster. Fourth, state statutes and common laws did not always refer to such protection as “common law copyright,” instead covering protection under unfair competition laws. Should those be part of the safe harbor? How would we know if the only word used is copyright?

That said, I think the court’s reliance on 301(c) is misplaced; I don’t think that a reading of 512 that safe harbored pre-1972 recordings would limit state law. I just don’t think that’s what the statute says, unfortunately.

Just to be clear, this ruling is a bad thing, a disaster even. I am not convinced that it will increase any liability, but it will surely increase costs and uncertainty. If I had to write the statute differently, I would. I’m sure others would as well.

But the question of the day is whether policy should trump plain meaning when we apply a statute. The ReDigi case and the UMG case both seem to have been written to address statutes who did not foresee the policy implications downstream. Perhaps many might say yes, we should read the statute differently.

I’m pretty sure I disagree. For whatever reason – maybe the computer programmer in me – I have always favored reading the statute as it is and dealing with the bugs through fixes or workarounds. As I’ve argued with patentable subject matter, the law becomes a mess if you attempt to do otherwise.  ReDigi and UMG are examples of bugs. We need to fix or work around them. It irritates me to no end that Congress won’t do so, but I have a hard time saying that the statutes should somehow mean something different than they say simply because it would be a better policy if they did. Perhaps that’s why I prefer standards to rules – the rules are good, until they aren’t.

This is not to say I’m inflexible or unpragmatic. I’m happy to tweak a standard to meet policy needs. I’ve blogged before about how I think courts have misinterpreted the plain meaning of the CFAA, but I am nevertheless glad that they have done so to reign it in. I’m also often persuaded that my reading of a statute is wrong (or even crazy) even when I initially thought it was clear. I’d be happy for someone to find some argument that fixes the UMG case in a principled way. I know some of my colleagues look to the common law, for example, to solve the ReDigi problem. Maybe there is a common law solution to UMG. But until then, for me at least, plain meaning trumps policy.