Digital Media Lawyer Blog

YouTube has been amassing an impressive list of music industry giants who have agreed to license their content for performance on its site. Recent additions to the fold include Warner Music and the UK Performing Rights Society. These are simply two more examples of the recent warming trend in the music and video copyright holding community's attitude toward YouTube

I recently attended a meeting of the California Copyright Conference which featured a panel appearance by Zahava Levine, YouTube's knowledgeable and enthusiastic Chief Counsel. CCC membership includes publishers, songwriters, attorneys, representatives from trade publications, performing rights societies, motion pictures, television, multimedia, Internet, and record companies. Given the amount of infringement of CCC member's copyrights that exists online, I half expected to see bushels of rotten tomatoes and crates of eggs to be hurled in Ms. Levine's direction.

There were universal complaints about diminished royalties from music in general -- much of which was attributed to Internet file-sharing. However, many, if not most, CCC members seemed to view YouTube as a possible savior and were eager to learn how to make money from the site.

As Zahava explained (and is further detailed on YouTube's site), YouTube offers audio and video copyright holders three options for dealing with unauthorized copyrighted material: a copyright holder can either block, monetize or track such unauthorized material. Under the "block" option, a copyright holder can send a DMCA notice to YouTube identifying the infringing material and requesting YouTube to take it down. Under the monetize option, a copyright holder can share in revenue, such as earnings from InVideo ads overlaid on videos and banner ads running next to videos. Under the tracking option, a copyright holder can simply choose to monitor traffic for videos containing its material, using YouTube's analytics tools.

To aid in these three goals, YouTube has created tools to identify infringing audio and video files on its site -- called "Audio ID" and "Video ID." Zahava explained to me that these operate as fingerprinting technologies. (Although "fingerprint" is not YouTube's preferred term for this process.) A copyright holder provides YouTube with a master audio or video file from which YouTube creates a fingerprint. This fingerprint is then compared to the millions of audio and video files in YouTube's system to identify infringing material. Participating copyright holders can than opt to either block, monetize or simply monitor the identified material -- the three options described above. Zahava did not provide the CCC members with specific metrics on the effectiveness of this technology, but indicated that it was one of the most effective in the industry. For more on YouTube's content protection programs, see http://www.youtube.com/t/content_management.

While some copyright holders would like to achieve complete control over their content and wring a dime or dollar from every performance, copy or distribution, this has never been possible. YouTube's approach brings the promise of at least some monetary returns -- even if these currently are far less than the rapidly vanishing dollars from CD and DVD sales. But who can say what the future holds.

David D. Johnson is a business lawyer whose practice focuses on litigation and other issues relating to digital media and consumer electronics companies. David can be contacted at (310) 785-5371 or DJohnson@jmbm.com.

On September 25, 2009, Amazon.com reached a proposed settlement with the plaintiffs in the class action brought over its unilateral deletion of the George Orwell works 1984 and Animal Farm from Kindle devices. See Gawronski v. Amazon.com, Inc., Western District of Washington, No. 09-cv-01084. The settlement not only provides substantial compensation for affected customers, but it also prohibits Amazon for engaging in future deletions of books sold under its current terms of service for the Kindle.

Everyone remembers the flap this past summer over Amazon.com's unilateral removal of the Orwell books from the Kindle devices. Some customers saw their books disappear before their eyes. Others lost important notes they had written in the "margins" of the books. For example, one customer was a high school student who had purchased 1984 for use in a class and had recorded notes on passages in the book on his Kindle device. When Amazon removed his copy of 1984, his notes, which said things such as "remember this paragraph for your thesis," were rendered useless, since they were no longer associated with the text of the book.

On July 30, 2009, shortly after the Orwell works were removed, a class action was filed in a federal court in the State of Washington by two affected Kindle customers. The class action complaint alleged several legal theories against Amazon, including breach of the terms of use for the Kindle device, damage to the plaintiffs' computers in violation of CFAA, trespass to chattels (the plaintiffs' Kindle Devices), conversion (of the deleted material) and other grounds.

Then, on September 3, 2009, Amazon announced that it had contacted all customers whose Orwell books had been deleted and offered to provide them with a new copy of the deleted book, at no charge, or to pay them $30.00. Amazon had apparently already refunded the purchase price of the books to the some 2,000 affected customers at the time it originally deleted the Orwell books.

In its September 25 settlement, Amazon has agreed to go even further to compensate affected customers. Under the proposed settlement, Amazon has now agreed to restore all notes and annotations made by customers whose books were deleted, as well.

Amazon has also agreed that, for all books purchased pursuant to terms of service granting the Kindle purchaser the "non-exclusive right to keep a permanent copy" of each purchased Work and to "view, use and display [such Works] an unlimited number of times, solely on the [Devices] . . . and solely for [the purchasers'] personal, non-commercial use," it will not remotely delete or modify these books from Kindle devices purchased or being used in the U.S. That's a big mouthful. However, from my visit to the Amazon.com site this afternoon, it appears that this language is still included in the current terms of service for the Kindle. So this appears to mean that Amazon has agreed not to delete content from any Kindle devices that have been sold to date.

Continue reading "Kindle Class Action Settlement: Gawronski v. Amazon Suit Regarding Amazon.com's Removal of Orwell Works from Kindle Devices Settles, but Leaves Many Questions" »

Now that the new FCC commissioners are in place, the FCC is getting down to the task of working on a new broadband plan. As would be expected, this is renewing the debate over the place of ISP-level filtering, or "surveillance", as some prefer to call it. See, e.g., http://www.publicknowledge.org/node/2568 On one hand, ISP-level filtering creates the potential for a solution to the massive loss of revenues that illegal file-sharing costs copyright holders. On the other hand, ISP-level filtering would doubtlessly be over-inclusive and prevent many fair uses of copyrighted material.

Regardless of the side of the debate you are on, it is critical to determine whether ISP-filtering is permissible under U.S. law. ISP-level filtering involves examining some portion of the header or contents of information packets passing through an ISP. The primary legal hurdles to such inspection are federal and state wiretapping laws.

Under the federal Electronics Communication Privacy Act (ECPA), it is unlawful to intentionally intercept electronic communications. 18 U.S.C. § 2511. However, there are a number of exceptions for ISPs. The most important of these include (i) interceptions that are "a necessary incident to the rendition of [the ISP's] service or to the protection of the rights or property of the provider of that service" and (ii) interceptions where "one of the parties to the communication has given prior consent to such interception." While both of these exceptions hold promise for those in favor of using ISP-filtering, both present practical problems.

Continue reading "Internet Service Provider-Level Filtering for Copyrighted Materials and Federal Wiretap Laws" »