AI Case Brief
Generate an AI-powered case brief with:
Estimated cost: $0.001 - $0.003 per brief
Full Opinion
Opinion by Judge TALLMAN; Partial Concurrence and Partial Dissent by Judge MILAN D. SMITH, JR.
ORDER
The opinion and dissent filed on September 14, 2015 and published at 801 F.3d 1126 are hereby amended. The amended opinion and dissent are filed concurrently with this order.
With these amendments, the panel has voted to deny Universalâs petition for panel rehearing and Lenzâs petition for panel rehearing. Judge Tallman and Judge Murguia have voted to deny Lenzâs petition for rehearing en banc, and Judge M. Smith has voted to grant Lenzâs petition for rehearing en banc.
The full court has been advised of the petition for rehearing en banc. No judge has requested a vote on whether to rehear the matter en banc. Fed. R.App. P. 35(b).
Universalâs petition for panel rehearing is DENIED. Lenzâs petition for panel rehearing or rehearing en banc is DENIED. No future petitions for panel rehearing or petitions for rehearing en banc will be entertained.
OPINION
Stephanie Lenz filed suit under 17 U.S.C. § 512(f) â -part of the Digital Millennium Copyright Act (âDMCAâ) â against Universal Music Corp., Universal Music Publishing, Inc., and Universal Music Publishing Group (collectively âUniversalâ). She alleges Universal misrepresented in a takedown notification that her 29-second home video (the âvideoâ) constituted an infringing use of a portion of a composition by the Artist known as Prince, which Universal insists was unauthorized by the. law. Her claim boils down to a -question of whether copyright holders have been abusing the extrajudicial takedown procedures provided for in the DMCA by declining to first evaluate whether the content qualifies as fair use. We hold that the statute requires copyright holders to consider fair use before sending a takedown notification, and that in this case, there is a triable issue as to whether the copyright holder formed a subjective good faith belief that the use was not authorized by law. We
I
Founded in May 2005, YouTube (now owned by Google) operates a website that hosts user-generated content. About YouTube, YouTube.com, https://www.youtube. com/yt/about/ (last visited September 4, 2015). Users upload videos directly to the website. Id. On February 7, 2007, Lenz uploaded to YouTube a 29-second home video of her two young children in the family kitchen dancing to the song Letâs Go Crazy by Prince.
At the time Lenz posted the video, Universal was Princeâs publishing administrator responsible for enforcing his copyrights. To accomplish this objective with respect to YouTube, Robert Allen, Universalâs head of business affairs, assigned Sean Johnson, an assistant in the legal department, to monitor YouTube on a daily basis. Johnson searched YouTube for Princeâs songs and reviewed the video postings returned by his online search query. When reviewing such videos, he evaluated whether they âembodied a Prince compositionâ by making âsignificant use of ... the composition, specifically if the song was recognizable, was in a significant portion of the video or was the focus of the video.â According to Allen, â[t]he general guidelines are that ... we review the video to ensure that the composition was the focus and if it was we then notify YouTube that the video should be removed.â
Johnson contrasted videos that met this criteria to those âthat may have had a second or less of a Prince song, literally a one line, half line of Prince songâ or âwere shot in incredibly noisy environments, such as bars, where there could be a Prince song playing deep in the background ... to the point where if there was any Prince composition embodied ... in those videos that it was distorted beyond reasonable recognition.â None of the video evaluation guidelines explicitly include consideration of the fair use doctrine.
When Johnson reviewed Lenzâs video, he recognized Letâs Go Crazy immediately. He noted that it played loudly in the background throughout the entire video. Based on these details, the videoâs title, and Lenzâs query during the video asking if her son liked the song, he concluded that Princeâs song âwas very much the focus of the video.â As a result, Johnson decided the video should be included in a takedown notification sent to YouTube that listed more than 200 YouTube videos Universal believed to be making unauthorized use of Princeâs songs.
After receiving the takedown notification, YouTube removed the video and sent
II
Lenz filed the instant action on July 24, 2007, and her Amended Complaint on August 15, 2007. After the district court dismissed her tortious interference claim and request for declaratory relief, Lenz filed her Second Amended Complaint on April 18, 2008, alleging only a claim for misrepresentation under § 512(f). The district court denied Universalâs motion to dismiss the action.
On February 25, 2010, the district court granted Lenzâs partial motion for summary judgment on Universalâs six affirmative defenses, including the third affirmative defense that Lenz suffered no damages. Both parties subsequently moved for summary judgment on Lenzâs § 512(f) misrepresentation claim. On January 24, 2013, the district court denied both motions in an order that is now before us.
The district court certified its summary judgment order for interlocutory appeal under 28 U.S.C. § 1292(b), and stayed proceedings in district court pending resolution of the appeal. We granted the parties permission to bring an interlocutory appeal.
III
We review de novo the district courtâs denial of summary judgment. When doing so, we âmust determine whether the evidence, viewed in a light most favorable to the non-moving party, presents any genuine issues of material fact and whether the district court correctly applied the law.â Warren v. City of Carlsbad, 58 F.3d 439, 441 (9th Cir.1995). On cross-motions for summary judgment, we evaluate each motion independently, âgiving the nonmoving party in each instance the benefit of all reasonable inferences.â ACLU v. City of Las Vegas, 333 F.3d 1092, 1097 (9th Cir.2003).
When evaluating an interlocutory appeal, we âmay address any issue fairly included within the certified order because it is the order that is appealable, and not the controlling question identified by the district court.â Yamaha Motor Corp., U.S.A. v. Calhoun, 516 U.S. 199, 205, 116 S.Ct. 619, 133 L.Ed.2d 578 (1996) (emphasis in original) (quotation omitted). We may therefore âaddress those issues material to the order from which appeal has been taken.â In re Cinematronics, Inc., 916 F.2d 1444, 1449 (9th Cir.1990) (emphasis in original) (permitting appellate review of a ruling issued prior to the order certified for interlocutory appeal).
IV
Effective on October 28, 1998, the DMCA added new sections to existing copyright law by enacting five Titles, only one of which is relevant here: Title IIâ Online Copyright Infringement Liability
A
Section 512(c) permits service providers, e.g., YouTube or Google, to avoid copyright infringement liability for storing usersâ content if â among other requirements â the service provider âexpeditiouslyâ removes or disables access to the content after receiving notification from a copyright holder that the content is infringing. 17 U.S.C. § 512(c). Section 512(c)(3)(A) sets forth the elements that such a âtakedown notificationâ must contain. These elements include identification of the copyrighted work, identification of the allegedly infringing material, and, critically, a statement that the copyright holder believes in good faith the infringing material âis not authorized by the copyright owner, its agent, or the law.â Id. § 512(c)(3)(A). The procedures outlined in § 512(c) are referred to as the DMCAâs âtakedown procedures.â
To avoid liability for disabling or removing content, the service provider must notify the user of the takedown. Id. § 512(g)(1) â (2). The user then has the option of restoring the content by sending a counter-notification, which must include a statement of âgood faith belief that the material was removed or disabled as a result of mistake or misidentification.... â Id. § 512(g)(3)(C). Upon receipt of a valid counter-notification, the service provider must inform the copyright holder of the counter-notification and restore the content within ânot less than 10, nor more than 14, business days,â unless the service provider receives notice that the copyright holder has filed a lawsuit against the user seeking to restrain the userâs infringing behavior. Id. § 512(g)(2)(B)-(C). The procedures outlined in § 512(g) are referred to as the DMCAâs âput-back procedures.â
If an entity abuses the DMCA, it may be subject to liability under § 512(f). That section provides: âAny person who know^ ingly materially misrepresents under this section â (1) that material or activity is infringing, or (2) that material or activity was removed or disabled by mistake or misidentification, shall be liable for any damages----â Id. § 512(f). Subsection (1) generally applies to copyright holders and subsection (2) generally applies to users. Only subsection (1) is at issue here.
B
We must first determine whether 17 U.S.C. § 512(c)(3)(A)(v) requires copyright holders to consider whether the potentially infringing material is a fĂĄir use of a copyright under 17 U.S.C. § 107 before issuing a takedown notification. Section 512(c)(3)(A)(v) requires a takedown notification to include a âstatement that the complaining party has a good faith belief that the use of the material in the manner complained of is not authorized by the copyright owner, its agent, or the law.â The parties dispute whether fair use is an authorization under the law as contemplated by the statute â which is so far as we know an issue of first impression in any circuit across the nation. âCanons of statutory construction dictate .that if the language of a statute is clear, we look no further than that language in determining the statuteâs meaning.... A court looks to legislative history only if the statute is unclear.â United States v. Lewis, 67 F.3d 225, 228-29 (9th Cir.1995) (citations omitted). We agree with the district court and hold that the statute unambiguously contemplates fair use as a use authorized by the law.
Fair use is not just excused by the law, it is wholly authorized by the law. In 1976, Congress codified the application of a
Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, ... for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall includeâ
(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
(2) the nature of the copyrighted work;
(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
(4) the effect of the use upon the potential market for or value of the copyrighted work.
The fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors.
17 U.S.C. § 107 (emphasis added). The statute explains that the fair use of a copyrighted work is permissible because it is a non-infringing use.
While Title 17 of the United States Code (âCopyrights!â) does not define the term âauthorizeâ or âauthorized,â â[w]hen there is no indication that Congress intended a specific legal meaning for the term, the court may look to sources such as dictionaries for a definition.â United States v. Mohrbacher, 182 F.3d 1041, 1048 (9th Cir.1999). Blackâs Law Dictionary defines âauthorizeâ as â1. To give legal authority; to empowerâ and â2. To formally approve; to sanction.â Authorize, Blackâs Law Dictionary (10th ed. 2014). Because 17 U.S.C. § 107 both âempowersâ and âformally approvesâ the use of copyrighted material if the use constitutes fair use, fair use is âauthorized by the lawâ within the meaning of § 512(c). See also 17 U.S.C. § 108(f)(4) (âNothing in this section in any way affects the right of fair use as provided by section 107____â (emphasis added)).
Universalâs sole textual argument is that fair use is not âauthorized by the lawâ because it is an affirmative defense that excuses otherwise infringing conduct. Universalâs interpretation is incorrect as it conflates two different concepts: an affirmative defense that is labeled as such due to the procedural posture of the case, and an affirmative defense that excuses impermissible conduct. Supreme Court precedent squarely supports the conclusion that fair use does not fall into the latter camp: â[A]nyone who ... makes a fair use of the work is not an infringer of the copyright with respect to such use.â Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 433, 104 S.Ct. 774, 78 L.Ed.2d 574 (1984).
Given that 17 U.S.C. § 107 expressly authorizes fair use, labeling it as an affirmative defense that excuses conduct is a misnomer:
Although the traditional approach is to view âfair useâ as an affirmative defense, this writer, speaking only for himself, is of the opinion that it is better viewed as a right granted by the Copyright Act of 1976. Originally, as a judicial doctrine without any statutory basis, fair use was an infringement that was excused â this is presumably why it was treated as a defense. As a statutory doctrine, however, fair use is not an infringement. Thus, since the passage of the 1976 Act, fair use should no longer be considered an infringement to be excused; instead, it is logical to view fair use as a right. Regardless of how fair use is viewed, it*1153 is clear that the burden of proving fair use is always on the putative infringer.
Bateman v. Mnemonics, Inc., 79 F.3d 1532, 1542 n. 22 (11th Cir.1996) (Birch, J.). We agree. Cf. Lydia Pallas Loren, Fair Use: An Affirmative Defense?, 90 Wash. L. Rev. 685, 688 (2015) (âCongress did not intend fair use to be an affirmative defense â a defense, yes, but not an affirmative defense.â). Fair use is therefore distinct from affirmative defenses where a use infringes a copyright, but there is no liability due to a valid excuse, e.g., misuse of a copyright, Practice Management Information Corp. v. American Medical Assân, 121 F.3d 516, 520 (9th Cir.1997), and laches, Danjaq LLC v. Sony Corp., 263 F.3d 942, 950-51 (9th Cir.2001).
Universal concedes it must give due consideration to other uses authorized by law such as compulsory licenses. The introductory language in 17 U.S.C. § 112 for compulsory licenses closely mirrors that in the fair use statute. Compare 17 U.S.C. § 112(a)(1) (âNotwithstanding the provisions of section 106, ... it is not an infringement of copyright for a transmitting organization entitled to transmit to the public a performance or display of a work ... to make no more than one copy or phonorecord of a particular transmission program embodying the performance or display----â), with id. § 107 (âNotwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work ... is not an infringement of copyright.â). That fair use may be labeled as an affirmative defense due to the procedural posture of the case is no different than labeling a license an affirmative defense for the same reason. Compare Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 573 & n. 3, 59Ă, 114 S.Ct. 1164, 127 L.Ed.2d 500 (1994) (stating that âfair use is an affirmative defenseâ where the district court converted a motion to dismiss based on fair use into a motion for summary judgment), with A & M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1025-26 (9th Cir.2001) (âNapster contends that ... the district court improperly rejected valid affirmative defenses of ... implied license____â). Thus, Universalâs argument that it need not consider fair use in addition to compulsory licenses rings hollow.
Even if, as Universal urges, fair use is classified as an âaffirmative defense,â we hold â for the purposes of the DMCA â fair use is uniquely situated in copyright law so as to be treated differently than traditional affirmative defenses. We conclude that because 17 U.S.C. § 107 created a type of non-infringing use, fair use is âauthorized by the lawâ and a copyright holder must consider the existence of fair use before sending a takedown notification under § 512(c).
C
We must next determine if a genuine issue of material fact exists as to whether Universal knowingly misrepresented that it had formed a good faith belief the video did not constitute fair use. This inquiry lies not in whether a court would adjudge the video as a fair use, but whether Universal formed a good faith belief that it was not. Contrary to the district courtâs holding, Lenz may proceed under an actual knowledge theory, but not under a willful blindness theory.
1
Though Lenz argues Universal should have known the video qualifies for fair use as a matter of law, we have already decided a copyright holder need only form a subjective good faith belief that a use is ⢠not authorized. Rossi v. Motion Picture Assân of Am. Inc., 391 F.3d 1000 (9th Cir.2004). In Rossi, we explicitly held that âthe âgood faith belief requirement in § 512(c)(3)(A)(v) encompasses a subjective, rather than objective
When enacting the DMCA, Congress could have easily incorporated an objective standard of reasonableness. The fact that it did not do so indicates an intent to adhere to the subjective standard traditionally associated with a good faith requirement....
In § 512(f), Congress included an expressly limited cause of action for improper infringement notifications, imposing liability only if the copyright ownerâs notification is a knowing misrepresentation. A copyright owner cannot be liable simply because an unknowing mistake is made, even if the copyright owner acted unreasonably in making the mistake. Rather, there must be a demonstration of some actual knowledge of misrepresentation on the part of the copyright owner.
Id. at 1004-05 (citations omitted). Neither of these holdings are dictum. See United States v. Johnson, 256 F.3d 895, 914 (9th Cir.2001) (en banc) (â[Wjhere a panel confronts an issue germane to the eventual resolution of the case, and resolves it after reasoned consideration in a published opinion, that ruling becomes the law of the circuit, regardless of whether doing so is necessary in some strict logical sense.â). We therefore judge Universalâs actions by the subjective beliefs it formed about the video.
2
Universal faces liability if it knowingly misrepresented in the takedown notification that it had formed a good faith belief the video was not authorized by the law, i.e., did not constitute fair use. Here, Lenz presented evidence that Universal did not form any subjective belief about the videoâs fair use â one way or anotherâ because it failed to consider fair use at all, and knew that it failed to do so. Universal nevertheless contends that its procedures, while not formally labeled consideration of fair use, were tantamount to such consideration. Because the DMCA requires consideration of fair use prior to sending a takedown notification, a jury must determine whether Universalâs actions were sufficient to form a subjective good faith belief about the videoâs fair use or lack thereof.
To be clear, if a copyright holder ignores or neglects our unequivocal holding that it must consider fair use before sending a takedown notification, it is liable for damages under § 512(f). If, however, a copyright holder forms a subjective good faith belief the allegedly infringing material does not constitute fair use, we are in no position to dispute the copyright holderâs belief even if we would have reached the opposite conclusion. A copyright holder who pays lip service to the consideration of fair use by claiming it formed a good faith belief when there is evidence to the contrary is still subject to § 512(f) liability. Cf. Disney Enters., Inc. v. Hotfile Corp., No. 11-cv-20427, 2013 WL 6336286, at *48
3
We hold the willful blindness doctrine may be used to determine whether a copyright holder âknowingly materially misrepresent[ed]â that it held a âgood faith beliefâ the offending activity was not a fair use. See 17 U.S.C. § 512(c)(3)(A)(v), (f). â[T]he willful blindness doctrine may be applied, in appropriate circumstances, to demonstrate knowledge or awareness of specific instances of infringement under the DMCA.â Viacom Intâl, Inc. v. YouTube, Inc., 676 F.3d 19, 35 (2d Cir.2012) (interpreting how a party can establish the âactual knowledgeââa subjective beliefâ required by § 512(c)(1)(A)ÂŽ);. see also UMG Recordings, Inc. v. Shelter Capital Partners LLC, 718 F.3d 1006, 1023 (9th Cir.2013) (âOf course, a service provider cannot willfully bury its head in the sand to avoid obtaining such specific knowledge.â (citing Viacom, 676 F.3d at 31)). But, based on the specific facts presented during summary judgment, we reject the district courtâs conclusion that Lenz may proceed to trial under a willful blindness theory.
To demonstrate willful blindness a plaintiff must establish two factors: â(1) the defendant must subjectively believe that there is a high probability that a fact exists and (2) the defendant must take deliberate actions to avoid learning of that fact.â Global-Tech Appliances, Inc. v. SEB S.A., 563 U.S. 754, 131 S.Ct. 2060, 2070, 179 L.Ed.2d 1167 (2011). âUnder this formulation, a willfully blind defendant is one who takes deliberate actions to avoid confirming a high probability of wrongdoing and who can almost be said to have actually known the critical facts.â Id. at 2070-71. To meet the Global-Tech test, Lenz must demonstrate a genuine issue as to whetherâbefore sending the takedown notificationâUniversal (1) subjectively believed there was a high probability that the video constituted fair use, and (2) took deliberate actions to avoid learning of this fair use.
On summary judgment Lenz failed to meet a threshold showing of the first factor. To make such a showing, Lenz must provide evidence from which a juror could infer that Universal was aware of a high probability the video constituted fair use. See United States v. Yi, 704 F.3d 800, 805 (9th Cir.2013). But she failed to provide any such evidence. The district court therefore correctly found that âLenz does not present evidence suggesting Universal subjectively believed either that there was a high probability any given video might make fair use of a Prince composition or her video in particular made fair use of Princeâs song âLetâs Go
Y
Section 512(f) provides for the recovery of âany damages, including costs and attorneys[â] fees, incurred by the alleged infringer ... who is injured by such misrepresentation, as the result of the service provider relying upon such misrepresentation in removing or disabling access to the material or activity claimed to be infringing.... â 17 U.S.C. § 512(f). We hold a plaintiff may seek recovery of nominal damages for an injury incurred as a result of a § 512(f) misrepresentation.
Universal incorrectly asserts that Lenz must demonstrate she incurred âactual monetary loss.â Section 512(k) provides a definition for âmonetary reliefâ as âdamages, costs, attorneys^] fees, and any other form of monetary payment.â The term âmonetary reliefâ appears in § 512(a), (b)(1), (c)(1), and (d), but is notably absent from § 512(f). As a result, the damages an alleged infringer may recover under § 512(f) from âany personâ are broader than monetary relief.
Lenz may seek recovery of nominal damages due to an unquantifiable harm suffered as a result of Universalâs actions.
âIn a number of common law actions associated with intentional torts, the violation of the plaintiffs right has generally been regarded as a kind of legal damage in itself. The plaintiff who proves an intentional physical tort to the person or to property can always recover nominal damages.â 3 Dan B. Dobbs et al., The Law of Torts § 480 (2d ed. 2011). The tort need not be physical in order to recover nominal damages. Defamation, for example) permits the recovery of nominal damages:
A nominal damage award can be justified in a tort action only if there is some reason for awarding a judgment in favor of a claimant who has not proved or does not claim a compensable loss with sufficient certainty to justify a recovery of compensatory or actual' damages. There may be such a reason in an action for defamation, since a nominal damage award serves the purpose of vindicating the plaintiffs character by a verdict of the jury that establishes the falsity of the defamatory matter.
W. Page Keeton et al., Prosser and Keeton on Torts § 116A, at 845 (5th ed. 1984). Also, individuals may recover nominal damages for trespass to land, even though the trespasserâs âpresence on the land causes no harm to the land [or] its possessor .... â Restatement (Second) of Torts § 163 & cmts. d, e (1965).
The district court therefore properly concluded in its 2010 order:
The use of âany damagesâ suggests strongly Congressional intent that recovery be available for damages even if they do not amount to ... substantial economic damages.... Requiring a plaintiff who can [show that the copyright holder knowingly misrepresented its subjective good faith] to demonstrate in addition not only that she suffered damages but also that those damages were economic and substantial would vitiate the deterrent effect of the statute.
Lenz v. Universal Music Corp., No. C 07-3783 JF, 2010 WL 702466, at *10 (N.D.Cal., Feb. 25, 2010). Relying on this opinion, the Southern District of Florida held the same. Hotfile, 2013 WL 6336286, at *48 (â[T]he Court observes that the quantity of economic damages to Hotfileâs system is necessarily difficult to measure with precision and has led to much disagreement between the parties and their experts. Notwithstanding this difficulty, the fact of injury has been shown, and Hotfileâs expert can provide the jury with a non-speculative basis to assess damages.â).
We agree that Lenz may vindicate her statutorily created rights by seeking nominal damages. Because a jury has not yet determined whether Lenz will prevail at trial, we need not decide the scope of recoverable damages, i.e., whether she may recover expenses following the initiation of her § 512(f) suit or pro bono costs and attorneysâ fees, both of which arose as a result of the injury incurred.
VI
Copyright holders cannot shirk their duty to consider â in good faith and prior to sending a takedown notificationâ whether allegedly infringing material constitutes fair use, a use which the DMCA plainly contemplates as authorized by the law. That this step imposes responsibility on copyright holders is not a reason for us to reject it. Cf. Consumer Prod. Safety Commân v. GTE Sylvania, Inc., 447 U.S. 102, 123-24, 100 S.Ct. 2051, 64 L.Ed.2d 766 (1980) (â[A]ny increased burdens imposed on the Commission as a result of its compliance with [the Consumer Product Safety Act] were intended by Congress in striking
AFFIRMED. Each party shall bear its own costs.
. YouTube is a for-profit company that generates revenues by selling advertising. If users choose to become âcontent partnersâ with YouTube, they share in a portion of the advertising revenue generated. Lenz is not a content partner and no advertisements appear next to the video.
. "[T]he parties do not dispute that Lenz used copyrighted material in her video or that Universal is the true owner of Princeâs copyrighted music.â Lenz v. Universal Music Corp., 572 F.Supp.2d 1150, 1153-54 (N.D.Cal.2008).
. Although the panel agrees on the legal principles we discuss herein, we part company with our dissenting colleague over the propriety of resolving on summary judgment Universalâs claim to subjective belief that the copyright was infringed. The dissent would find that no triable issue of fact exists because Universal did not specifically and expressly consider the fair-use elements of 17 U.S.C. § 107. But the question is whether the analysis Universal did conduct of the video was sufficient, not to conclusively establish as a matter of law that the videoâs use of Letâs Go Crazy was fair, but to form a subjective good faith belief that the video was infringing on Prince's copyright. And under the circumstances of this case, that question is for the jury, not this court, to decide.
. Title I of the DMCA specifies recovery for "actual damages.â 17 U.S.C. § 1203(c)(1)(A). If Congress intended to similarly limit the recovery of § 512(f) damages to pecuniary losses, it could have chosen to do so.
. Lenz may not recover nominal damages for "impairment of free speech rights.â No authority supports the recovery of nominal damages caused by a private actorâs chilling of free speech rights. All of the cases Lenz cites address challenges to governmental action.