Court Says That Copyright Owners Must Consider Fair Use Prior To Sending Infringement Notice Under The Digital Millennium Copyright Act

November 17, 2008

Summary

In an issue of first impression, a California federal district court held that prior to sending a takedown notice to an online service provider alleging copyright infringement under the Digital Millennium Copyright Act (“DMCA”), the sender must evaluate use of the material under copyright law’s fair use doctrine. Lenz v. Universal Music Corp., No. C 07-3783 JF, 2008 U.S. Dist. LEXIS 66335 (N.D. Cal. Aug. 28, 2008). Copyright owners who do not consider fair use prior to sending a DMCA takedown notice risk a claim of misrepresentation under the DMCA.

Background

Plaintiff Stephanie Lenz videotaped her young children dancing in her family’s kitchen while the Prince song “Let’s Go Crazy” played in the background and uploaded the video to YouTube. The Prince song can be heard for approximately twenty seconds in the twenty-nine second video.

Universal, the copyright owner of “Let’s Go Crazy”, sent YouTube a DMCA takedown notice claiming that the video infringed its copyright and demanding that YouTube remove the video from its website. In response to Universal’s accusation of copyright infringement, YouTube removed the video and sent Lenz an email notifying her that it had done so. Following the procedure set forth in the DMCA, Lenz sent YouTube a counter-notification asserting that her video constituted fair use of “Let’s Go Crazy” and thus did not infringe Universal’s copyright. Lenz demanded that YouTube repost the video. About six weeks later YouTube reposted the video on its website. As of November 17, 2008, the video has been viewed more than 800,000 times.

Lenz filed suit against Universal alleging misrepresentation. Under the DMCA, “any person who knowingly misrepresents” that material is infringing is potentially liable for misrepresentation.  Instead of filing an answer to Lenz’s complaint, Universal filed a motion to dismiss for failure to state a claim.

Analysis

When sending a DMCA takedown notice the person sending the notice is obligated to include a statement in the notice that he or she has a “good faith belief” that the particular use of the copyrighted material he or she is complaining about is not “authorized by law.” In light of this requirement, the Court considered whether a copyright owner must evaluate the question of fair use prior to sending a takedown notice—specifically, whether fair use qualifies as a use “authorized by law”.

The Court found that a use protected by the fair use doctrine is a use that is “authorized by law”. Accordingly, in order to send a takedown notice in good faith, the sender must evaluate fair use prior to sending the notice. An allegation that a copyright owner acted in bad faith by issuing a takedown notice without proper consideration of the fair use doctrine thus is sufficient to state a claim for misrepresentation under the DMCA.

Universal had argued that copyright owners could lose the ability to respond to potential infringements if they were required to evaluate fair use prior to issuing a takedown notice. In support, Universal pointed out that a fair use inquiry is fact-intensive and that it may be difficult for copyright owners to predict whether a court would eventually rule in their favor.

The Court was unmoved by this line of argument calling Universal’s concerns “understandable” but their impact “likely overstated.” Since the standard for bad faith under the DMCA is subjective, there would likely be few cases in which a copyright owner’s determination that a particular use was not fair use would rise to the level of bad faith. The Court stated:

[u]ndoubtedly, some evaluations of fair use will be more complicated than others. But in the majority of cases, a consideration of fair use prior to issuing a takedown notice will not be so complicated as to jeopardize a copyright owner’s ability to respond rapidly to potential infringements.

Practice Note

Unless you are litigating in the Northern District of California, the Lenz case is not binding precedent. However, even though it is not binding precedent, other courts will surely consider Lenz when a similar issue arises. Therefore, prior to sending a notice of infringement to an online service provider, you should consider the fair use doctrine. You may want to contact your intellectual property attorney to assist you with such an analysis. If you consider and reject fair use prior to sending a claim of infringement, you will likely be less vulnerable to a claim for misrepresentation under the DMCA.

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