Viacom Appeals

As widely expected, Viacom has appealed the June 2010 district court ruling in Viacom v. YouTube to the Second Circuit. (I previously discussed the district court's decision granting summary judgment to YouTube in a 3 part post: Part I, Part II, Part III.) Viacom has a full text of the appeal as filed on their website.

Interestingly, Viacom has primarily focused on the factual findings of the district court in granting summary judgment for YouTube as an internet service provider under Section 512(c). Section 512(c) provides a defense to copyright infringement for certain activities carried out by internet service providers. (Further explanation available here.)

Viacom has stated three reasons why Section 512(c) should not apply to YouTube:

1. YouTube had knowledge that the content on YouTube was infringing or were aware of facts and circumstances that the content was infringing and did nothing to stop infringement. Viacom claims that YouTube’s general knowledge of infringing activity on its website should be sufficient to prevent YouTube’s service provider defense under Section 512(c).
   
   Viacom alleges that YouTube selectively enforced against copyright infringement when YouTube had programs available to weed out infringing works and ignoring community flagging systems that would have pointed out infringing works. Viacom also claims that YouTube was aware of the predominant amount of infringing works that were available on its site and encouraged these videos because YouTube received more “hits” from these videos.
   
   The court found that YouTube took appropriate action when advised of the alleged infringing web posts by Viacom. The court found specific knowledge was needed in order for the Section 512 defense to not apply.
2. YouTube had the ability and control over the infringing content and received a direct financial benefit. Viacom claims that YouTube gained financial benefits from advertising revenue due to the increased audience at its website. Viacom points to certain facts that YouTube realized that a major part of its success were videos that infringed on copyrights.
   
   Viacom also reiterates that YouTube could have taken action against infringing activities but did not. The district court found that YouTube must have specific knowledge of the infringing content in order to be able to control the infringing activity.
3. YouTube’s activities went beyond the storage function of a service provider under Section 512(c). Viacom claims that YouTube’s actions in posting user content includes more than just storage – including display, reproduction, performance and licensing content to others.
   
   The district court found that YouTube’s activities in placing the user’s content on its website was incidental to the acts of storage and thus was within the parameters of the Section 512(c) defense.

Viacom also seeks that summary judgment be reversed and granted in its favor. A number of amici have filed briefs on Viacom’s behalf including Business Software Alliance, Motion Picture Association of America, Microsoft, and members of the publishing and music industries.

For the first 2 reasons set forth by Viacom, it would seem heavily reliant on Grokster and general principles from the case. Based on the district court decision, Viacom would argue a couple of small changes and Grokster would not have been guilty of infringement. (This may be true.)

It will be interesting to see how the Second Circuit handles the issue of the district court’s finding regarding specific knowledge of infringement is necessary, not general knowledge.

I think the best that Viacom may be able to hope for from the Second Circuit is that there are triable issues of fact and summary judgment for YouTube was unwarranted. (Based on the number of facts presented by Viacom, this seems to be its strategy.)

The third reason set forth by Viacom is by far the more interesting legal argument. While Viacom is surely unhappy with the result of district court under Reasons 1 and 2 above and would like a ruling in its favor based on the facts it presents, it seems that Reason 3 would be the best argument to obtain summary judgment in Viacom’s favor. The more interesting questions facing the Second Circuit are not argued fully until nearly 50 pages into the Opening Brief.