On Aug. 27, 2008, in the case Io Group, Inc. v. Veoh Networks [1] (Veoh), U.S. Magistrate Judge Howard R. Lloyd granted Veoh’s motion for summary judgment, that it qualified for “safe harbor” protection under the Digital Millennium Copyright Act (DMCA), 17 U.S.C. § 512. The Veoh decision has been hailed by some as a major victory for Internet service providers and proponents of the sufficiency of the DMCA in addressing copyright infringement issues over the Internet. Does this decision supplant Grokster as the current precedent of U.S. courts with respect to an analysis of the legality of websites featuring user-generated content (UGC)? The Supreme Court’s decision in Grokster established that a service provider that has provided a platform and has promoted its use to infringe copyright or foster infringement could be found liable for the resulting acts of infringement by third parties. [2] In other words, if the service provider’s website has been used, to a significant degree, as a hub of infringing content, then such service provider may not be able to raise the safe harbor provisions of the DMCA as a defense to secondary copyright infringement.[3] Precedential considerations aside, a closer look at the facts of Veoh reveals that the court’s holding is actually quite limited in scope. 

The plaintiff in Veoh, Io Group, Inc. (Io), a publisher of adult video content, claimed in the lawsuit that it discovered clips from 10 of its copyrighted films had been uploaded and viewed on veoh.com without its authorization. Considering that the DMCA was created, in part, to provide a process for copyright owners to police and limit infringing activity, it would be paramount for any copyright owner seeking recourse for a claim of infringement to have complied with the procedures in place under the DMCA[4] prior to filing a lawsuit. Assuming that the website provided a copyright-infringement-claim designated agent to contact regarding infringement claims, a copyright owner would be required to have submitted DMCA-compliant notices of infringement to such designated agent, and have such agent fail to remove the allegedly infringing content, to have an actionable claim. In this case, Veoh had a designated agent assigned to review takedown notices, and maintained terms of use that set forth procedures that were compliant with the DMCA. Plaintiff Io, on the other hand, seemingly ignoring the DMCA procedures entirely, did not send a takedown notice to, or otherwise inform, Veoh that it had determined that its film content had been uploaded to the Veoh website without authorization. Actually, receipt of the complaint was the first notice Veoh received regarding Io’s infringement issues. Strike one.Continue Reading DMCA Alive and Well? An Analysis of the Veoh Decision