Source: https://www.amazonsellerslawyer.com/blog/copyright-infringement-amazon-sellers-dmca/
Timestamp: 2019-05-21 21:07:44
Document Index: 62260739

Matched Legal Cases: ['art 2', 'art 2', 'art 2', '§ 512', '§512', '§512', '§512', '§ 512', '§ 512', '§ 512', '§ 106', '§ 512', '§ 512', '§ 512', '§ 512', '§ 512', '§ 512', '§ 512', '§ 512', '§ 512']

E-Commerce, Amazon, and the DMCA Part 2 - Amazon Sellers Lawyer || Rosenbaum Famularo, PC
E-Commerce, Amazon, and the DMCA Part 2
Home → Suspension → E-Commerce, Amazon, and the DMCA Part 2
When a copyright matter reaches the litigation stage, the plaintiff has the burden of proving: (1) ownership of a valid copyright to the material in question; and (2) that the defendant violated the copyright owner’s exclusive rights under the Copyright Act.[1] Copyright infringement occurs “when a defendant violates one of the exclusive rights of the copyright holder.[2]
There are three traditional doctrines of copyright infringement. Direct copyright infringement requires the plaintiff to show that he owns the copyright and that the defendant personally violated one of the plaintiff’s rights enumerated in the Copyright Act. For contributory or vicarious infringement to be found, the court must first find direct infringement. The catch is that a third party who does not directly infringe could be held liable for secondary infringement. Contributory copyright infringement means an actor had knowledge of the activity and induces, causes, or materially contributes to the infringing conduct of another. Material contribution occurs when an actor “either actively encourages infringement, or knows of the infringing activity and could control it, but does nothing to prevent it.”[3] Vicarious liability for copyright infringement takes place when the accused “enjoys a direct financial benefit from another’s [directly] infringing activity and has the right and ability to supervise the infringing activity,” but declines to stop or limit it.[4] It is predominantly secondary infringement that concerns internet service providers like Amazon because they are often accused of hosting the product listings that are allegedly infringing a copyright.
History and Purpose of the DMCA
The DMCA aims to create an environment where rights owners and service providers can adequately “detect and deal with copyright infringements that take place in the digital networked environment.”[5] Congress thought that because of the evolution of the internet it was necessary to “provide greater certainty to service providers concerning their legal exposure for infringements that may occur in the course of their activities.”[6] The problems this note aims to address may be a direct result of the attitude of Congress towards drafting the DMCA. Congressional records indicate that rather than “embarking on a wholesale clarification” of the various doctrines of copyright liability, Congress decided “to leave current law in its evolving state and, instead, to create a series of “safe harbors,’ for certain common activities of service providers.”[7] It is this “evolving state” and unpredictability that require the act to be changed such that it fairly represents all that it governs.
The safe harbor provisions were included in the DMCA to exemplify “a compromise between the demands of copyright holders and the concerns of the Internet industry.”[8] In applying the DMCA today, courts have adopted a broad definition of the term service provider. Not only does the term internet service provider include traditional ISPs like Optimum online, but it also includes online retail platforms such as Amazon and eBay. Because service providers usually have a large supply of funds, are easy to identify, and can act as gatekeepers, internet service providers were often held liable for infringements by their users under the doctrines of contributory or vicarious liability.[9]
DMCA Safe Harbor Act
In response to the growing concern that the DMCA did not recognize the need for reduced liability in extenuating circumstances, congress enacted the DMCA Safe Harbor Act.[10] The Safe Harbor Act created four new limitations or safe harbors for copyright infringement by online service providers.[11] The four safe harbors provided by Congress, in the text of Section 512, are:
(d) Information location tools.[12]
A service provider who meets the requirements of § 512 is shielded from liability for all monetary relief for direct, vicarious, and contributory infringement in circumstances in which the infringing or allegedly infringing content are contained in the system without the knowledge and involvement of the service provider.
Amazon’s policy reflects knowledge of the law; they instantly suspend all allegations of copyright infringement to ensure compliance with the DMCA.[13] The law as it is written seems to require Amazon to do this regardless as to the validity of the claim if they wish to adhere to the knowledge requirement of §512. Amazon is forced to operate under fear of liability regardless of whether the allegation of infringement is factual. This was recently reinforced in Milo & Gabby, where Amazon was excused from vicarious copyright liability.[14] There, the court found that the infringing images used in a third-party seller’s product listing were part of a “software or hardware scheme” in which content was automatically produced and in which Amazon did not participate in.[15]
To be protected by one of the safe harbor provisions, one must first qualify as a service provider pursuant to the requirements of §512.[16] Assuming status as a service provider has been established, the service provider then must satisfy two additional elements: (1) it must adopt and reasonably implement a policy of terminating in appropriate circumstances the accounts of subscribers who are repeat infringers; and (2) it must accommodate and not interfere with standard technical measures.[17] Standard technical measures are how copyright owners identify and or protect their copyrighted works that “(A) have been developed pursuant to a broad consensus of copyright owners and service providers in an open, fair, voluntary, multi-industry standards process; (B) are available to anyone on reasonable nondiscriminatory terms; and (C) do not impose substantial costs … or substantial burdens on their systems or networks.”[18]
Even if a service provider does not meet the requirements to qualify for the limitations of §512, it does not mean that it is automatically liable for copyright infringement.[19] Under § 512(l), “the copyright owner must still demonstrate that the provider has infringed, and the provider may still avail itself of any of the defenses, such as fair use, that are available to copyright defendants generally.”[20] Further, § 512(h) outlines a procedure for how a copyright owner can obtain a subpoena “ordering a service provider to disclose the identity of a subscriber who is allegedly engaging in infringing activities.”[21] To “ensure that service providers are not placed in the position of choosing between limitations on liability … and preserving the privacy of their subscribers,” § 512(m) provides “nothing in section 512 requires a service provider to monitor its service or access material in violation of law (such as the Electronic Communications Privacy Act) to be eligible for any of the liability limitations.”[22]
Section 512(c) is notable because it relates very closely to the flaws in the DMCA associated with its e-commerce application and the Amazon platform. Section 512(c) applies to information that is user created and limits any infringement liability for the service provider that is hosting the information on its system.[23] Simply put, this limits Amazon’s liability for any infringement on its website that was perpetrated by a third-party seller using the platform. In this context, Amazon would not be held liable if: (1) [Amazon] does not have actual knowledge of the infringing material or activity; (2) [Amazon] has the right and ability to control the infringing activity, but does not receive a financial benefit directly attributable to the infringing activity; and (3) upon receiving proper notification of the claimed infringement, [Amazon] responds expeditiously to remove, or disable access to, the allegedly infringing material or activity.[24] Additionally, a service provider must also have filed a designated agent with the Copyright Office to “receive notifications of claimed infringement.”[25] If a service provider receives proper notice from a copyright owner that material on the service provider’s website is allegedly infringing, the service provider must “expeditiously remove the allegedly infringing content.”[26] However, the law has yet to clarify how long “expeditiously” really is, nor what constitutes proper notice.[27]
The knowledge of infringement requisite is typically held to be the most important factor in retaining the privilege of safe harbor. A service provider must also “not be aware of facts or circumstances from which infringement is apparent.”[28] However, once a service provider becomes aware of infringement, it must “act expeditiously to remove, or disable access to the alleged infringing content.”[29] Per the DMCA it does not matter whether the content or material is actually infringing; a service provider “must comply with a takedown notice or chance the loss of safe harbor.”[30]
The expeditious requirement is vague and has been interpreted differently by different courts. The senate report that was issued when the DMCA was enacted states that different scenarios require different response times.[31] No court to date has found that a service provider was liable for a failure to act expeditiously to a takedown notice.[32] However, this provision is beginning to receive more attention because copyright owners are increasingly complaining that ISPs are not responding “expeditiously” to their notice. Amending the DMCA to provide more clarity on the definition of “expeditious” will ultimately allow e-commerce platforms like Amazon to assess validity of claims prior to suspending sellers.
DMCA Notice and Take Down Provisions
The procedural requirements for proper notice are provided by the DMCA in section 512(c)(3), and include:
“(i) A physical or electronic signature of a person authorized to act on behalf of the owner of an exclusive right that is allegedly infringed;
(vi) A statement that the information in the notification is accurate, and under penalty of perjury, that the complaining party is authorized to act on behalf of the owner of an exclusive right that is allegedly infringed … .”[33]
If notice does not meet these standards, it will not be considered by the court in deciding whether the service provider had actual knowledge of the infringement.[34] For example in Perfect 10 Inc. v. CCBill LLC, the Ninth Circuit Court of Appeals held that notice provided by Perfect 10 was inadequate.[35] There, CCBill provided three notices that contained mistakes and were missing “one or more” of the requirements for notice. However, the courts have held that if a rights owner “substantially complies” with the identification requirements, and provides contact information, then the service provider must make an effort to remedy the deficient notice with the copyright.[36] The problem today is, different courts have come to opposite holdings in instances of notice with facts that seem identical. For example, in Hendrickson v. eBay, the court held that notice was deficient because it failed to alert eBay as to the location of specific material.[37] However, the court under similar facts in CLS Scan, Inc. v. Remar Q Communities, Inc. held that simply stating “virtually all” of the material on the website was infringing was sufficient to comply with DMCA requirements.[38]
Amazon provides an electronic form for users to report infringement. The form certainly complies with notice requirements, but again Amazon does nothing to verify a complaint. In order to put an end to copyright bullying on the Amazon platform, notice requirements should be made stricter. Holding notice requirements in the e-commerce context to a higher standard and making it more difficult to comply would arguably hinder those from making baseless complaints from doing so.
Robert C. Segall, Paralegal and 2018 J.D. Candidate, Rosenbaum Famularo, P.C., the intellectual property law firm behind AmazonSellersLawyer.com
[1] See; Fox Broad. Co. v. DISH Network L.L.C., 747 F.3d 1060, 1066-67 (9th Cir. 2014) (quoting Kelly v. Arriba Soft Corp., 336 F.3d 811, 817 (9th Cir. 2003)); see also 17 U.S.C. §§ 106(1), 501(a).
[3] Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913, 930 (2005); see also Gershwin Pub’g Corp. v. Columbia Artists Mgmt, Inc., 443 F.2d 1159, 1162 (2d Cir. 1971).
[4] Ellison v. Robertson, 357 F.3d 1072, 1076 (9th Cir. 2004).
[5] S. Rep. No. 105-190, at 20 (1998).
[6] Ellison, 357 F.3d at 1076.
[9] Weinstein, supra note 3.
[12] 17 USCS § 512.
[13] CJ Rosenbaum, Intellectual Property Complaints on Amazon, Seller Express (August 2, 2016) https://www.sellerexpress.com/intellectual-property-complaints-on-amazon/.
[14] Milo & Gabby, LLC v. Amazon.com, 2015 U.S. Dist. LEXIS 149939 (W.D. Wash. Nov. 3, 2015).
[16] Weinstein, supra note 3.
[18] 17 U.S.C. § 512(i)(2).
[19] Weinstein, supra note 3.
[22] 17 USCS § 512.
[23] Weinstein, supra note 3.
[24] 17 U.S.C. § 512(c)(1)(A)-(C).
[25] 17 U.S.C. § 512(c)(2).
[26] 17 U.S.C. § 512(c)(1)(A)(3), (c)(1)(C).
[27] Weinstein, supra note 3.
[29] 17 U.S.C. § 512(c)(1)(A)(3), (c)(1)(C).
[30] Eugene C. Kim, Note, YouTube: Testing the Safe Harbors of Digital Copyright Law, 17 S. Cal. Interdisc. L.J. 139, 139 (2007).
[31] Weinstein, supra note 3.
[33] 17 U.S.C. § 512(c)(3)(A).
[34] Weinstein, supra note 3.
[35] Perfect 10, Inc. v Amazon.com, Inc., 508 F.3d 1146 (9th Cir 2007).
[36] S. Rep. No. 105-190, at 46-47 (1998) (discussing 17 U.S.C. § 512(c)(3)(B)).
[37] Hendrickson v eBay, Inc., 165 F. Supp. 2d 1082 (C.D. Cal. 2001).
[38] ALS Scan, Inc. v RemarQ Cmtys., Inc., 239 F.3d 619 (4th Cir. 2001).
On June 21, 2017 / Suspension