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List:       dmca-discuss
Subject:    [DMCA_Discuss] Federal court broadens DMCA safe harbors
From:       Vladimir Katalov <vkatalov () elcomsoft ! com>
Date:       2004-07-22 10:40:03
Message-ID: 183499397703.20040722144003 () elcomsoft ! com
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Federal court broadens DMCA safe harbors
Last modified: July 21, 2004, 6:31 PM PDT
By Paul Festa 
Staff Writer, CNET News.com

http://news.com.com/Federal+court+broadens+DMCA+safe+harbors/2100-1028_3-5279000.html

Attorneys for a wide range of Internet companies may be in for a
surprise with a little-noticed federal ruling on DMCA immunity.

In a 56-page order handed down June 22, U.S. District Court Judge
Lourdes Baird muddied the already troubled waters of determining what
Internet businesses qualify for the "safe harbor" provisions of the
1998 Digital Millennium Copyright Act.

"There is a lot in this decision that will surprise lawyers who
thought they understood the safe harbors," said Fred von Lohmann,
senior intellectual-property attorney for the Electronic Frontier
Foundation. "Whatever a judge says is what goes, so we lawyers are
learning afresh what we thought we already knew."

The DMCA has regularly inspired controversy since its passage six
years ago, particularly for its prohibitions of technology designed to
circumvent copy-protection devices. And its complex safe harbors have
created headaches for lawyers and judges trying to determine who can
berth there.

Baird's order on motions for summary judgment comes nearly two years
after Perfect 10, an online pornography publisher, filed suit against
four different Internet companies alleging copyright infringement,
various trademark violations, unfair competition, false advertising,
violation of right of publicity and RICO (Racketeer Influenced and
Corrupt Organizations) Act violations.

Defendants in the case--age-verification service Internet Key; online
payment processor iBill, now owned by Penthouse; Web hosting provider
CWIE; and subscription payment manager CCBill--sought to have the
charges against them thrown out on the grounds that they qualified for
DMCA safe harbor protections.

Baird's ruling granted some motions for summary judgment and denied
others. In the process, according to legal experts, it apparently
articulated new protections for Internet businesses.

One law professor praised the order, saying it brought DMCA law more
in line with congressional intent.

"There are several firsts in this ruling," said Eric Goldman, an
assistant professor at Marquette University Law School. "Courts are
beginning to realize that the early rulings under the DMCA safe harbor
interpreted the safe harbor too strictly and unfairly, and therefore
the courts are reversing those rulings and providing more expansive
protections under the safe harbors."

In her order, Baird brought age-verification and payment services into
the DMCA safe harbor, raising the possibility that more businesses
that don't fall under the usual Web hosting and connectivity
categories will qualify.

She ruled that the online service providers qualified for the DMCA's
"information location," or "linking" safe harbor. Perfect 10 argued
that that safe harbor only applied to search engines like Yahoo and
Google, which locate and link to millions of sites they're not
affiliated with.

According to Baird, however, a company that linked to a limited
network of sites with which it had contractual relationships still
qualified.

The DMCA requires that copyright holders alleging a violation must
first issue a DMCA "takedown notice" to the company or individual in
question. Baird raised the bar for how specific DMCA takedown notices
must be before copyright owners can demand that a service provider
terminate an allegedly infringing subscriber.

"This ruling provides some very important--and
expansive--interpretations (of specific DMCA safe harbor sections), in
each case finding that a broad array of online service providers could
take advantage of the safe harbors and that copyright owners could not
thwart the safe harbor with weakly drafted notices of infringement or
by claiming that service providers aren't doing a good job policing
infringements," Goldman said.

Baird also staked new ground in the ever-evolving landscape of CDA
(Communications Decency Act) Sec. 230 immunity, a similar safe harbor
provision in the landmark 1996 law aimed at controlling online smut.
Sec. 230 shields ISPs and other online businesses from prosecution for
many of their subscribers' actions.

Sec. 230 immunity does not apply, however, to laws governing
intellectual property. In a potentially worrisome development for Web
publishers, Baird said the right of publicity--under which public
figures can sue businesses for using their likeness for commercial
purposes--is an intellectual-property matter, ruling out Sec. 230
protection for publishers.

Calling the DMCA safe harbors "horrifically complicated" and
"bewildering," the EFF's Lohmann said Baird's order may not have
gotten the letter of the law exactly right--particularly in raising
the bar for the specificity of DMCA takedown notices.

"I think the district court didn't really fully understand how the
safe harbors work," Lohmann said. "This again demonstrates that the
safe harbor provisions of the DMCA are so complicated that no judge
can be expected to figure them out."

_______________________________________________

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