United States: Copyright Owners Must Weigh Fair Use Before DMCA Takedown, 9th Circuit Holds

Paul Kilmer is a Partner and Dan Neustadt is an Associate in Holland & Knight's Washington D.C. office

HIGHLIGHTS:

• A three-judge panel for the U.S. Court of Appeals for the Ninth Circuit held on Sept. 14, 2015, that a copyright owner must consider whether a third party's online use of copyrighted content constitutes fair use before sending a notice to have the content removed.
• The 9th Circuit's decision in Lenz v. Universal Music Corp. et al. increases the administrative burden for copyright holders in policing the use of their works online.

A three-judge panel for the U.S. Court of Appeals for the Ninth Circuit held on Sept. 14, 2015, that a copyright owner must consider whether a third party's online use of copyrighted content constitutes fair use before sending a notice to have the content removed. The 9th Circuit's decision in Lenz v. Universal Music Corp. et al. increases the administrative burden for copyright holders in policing the use of their works online.

The case concerns a 29-second YouTube video uploaded by Stephanie Lenz of her then-13-month-old son dancing to "Let's Go Crazy," a song by the artist known as Prince. Universal submitted a notice to YouTube to take down the video. The takedown notice included the following statement by Universal, as required under the Digital Millennium Copyright Act (DMCA): "We have a good faith belief that the above-described activity is not authorized by the copyright owner, its agent, or the law." 17 U.S.C. §512(c)(3)(A)(v). After submitting counter-notices to YouTube to have the video reinstated, Lenz ultimately sued Universal under Section 512(f) of the DMCA, which provides for recovery of damages for "knowingly materially misrepresent[ing] ... that material or activity is infringing." (Since the enactment of the DMCA in 1998, fewer than five plaintiffs have obtained money damages under Section 512(f).)

The 9th Circuit held that, because fair use is expressly authorized by "the law" (i.e., Section 107 of the Copyright Act), a copyright owner cannot possess a "good faith belief" that allegedly infringing content is not "authorized by ... the law" without first considering fair use. Under the 9th Circuit's decision, a copyright holder's burden is met if it forms a "subjective good faith belief that the allegedly infringing material does not constitute fair use," regardless of whether that belief is correct. Opinion at 17 (emphasis in original). "[A] copyright holder's consideration of fair use need not be searching or intensive," but it must go beyond mere "lip service." Id. In the absence of such consideration, a copyright holder may be liable for at least nominal damages, regardless of any actual monetary loss suffered by the user.

Having affirmed the District Court's denial of the parties' cross-motions for summary judgment, the 9th Circuit remanded the case for further consideration, including, if liability is ultimately found, whether an award may include attorneys' fees.

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