October 2006

Intellectual Property Bulletin

The Intellectual Property Bulletin is published by the Intellectual Property Practice Group  at Arthur, Chapman, Kettering, Smetak & Pikala, P.A. to keep our clients informed of the ever-changing complexities of intellectual property and business litigation.  In this issue:

Google’s recent announcement that it is buying consumer-media company YouTube may end speculation about YouTube’s demise at the hands of copyright-infringement lawyers. Google knew of and considered the business and legal risks before agreeing to pay $1.65 billion for the wildly-popular free-video sharing web site.

YouTube.com started in early 2005 as a place for users to upload, view, and share short videos. Its popularity has exploded and currently almost 20 million people visit the site each month and view 100 million clips per day. Most of the videos uploaded and viewed on YouTube are original creations that do not contain copyrighted content. Copyright law protects original works of authorship and provides copyright owners the exclusive right to display and reproduce their works. Because not all videos and audio on YouTube are original works, YouTube has found itself at the center of a recent debate about uploading and viewing copyrighted works.

The debate made national news when internet entrepreneur and Dallas Mavericks owner Mark Cuban said anyone, including Google, would be crazy to buy YouTube because of its potentially huge copyright-infringement liability. In Cuban’s view, YouTube’s approach of making the copyright owner responsible for getting unauthorized content removed from the website is problematic. Legal and internet analysts have also compared YouTube to Napster which was repeatedly sued for copyright infringement by music artists and media companies for unlawful downloading of copyrighted-musical compositions. However, some experts see big differences between Napster and YouTube because YouTube has a substantially non-infringing use and uses short clips of video while Napster facilitated the downloading of entire songs.

YouTube is already defending one copyright-infringement lawsuit. The journalist who shot the film of Reginald Denny’s beating during the 1992 Los Angeles riots sued YouTube in federal court after the video was uploaded and viewed over 1,000 times. The plaintiff alleged YouTube’s infringement was willful and asked the court to award damages of $150,000 for each viewing occurrence. YouTube cited the safe-harbor provisions of the Digital Millennium Copyright Act (DMCA) as a defense to the lawsuit.

The DMCA is a 1998 federal law designed to secure the cooperation of online service providers in fighting copyright infringement. When a copyright owner suspects infringement, he must follow the DMCA’s "notice and takedown" provisions which include notifying providers like YouTube in writing of the infringed work. YouTube has the entire "notice and takedown" provision posted on its website. YouTube also discusses at length its stance against copyright infringement on its site and provides advice to its viewers of how to avoid and prevent infringement. By providing this information, YouTube argues its conduct is a "safe harbor" under the DMCA thereby protecting it from liability. YouTube often removes videos from its website pursuant to complaints filed by copyright owners. A recent example is YouTube’s removal of nearly 30,000 Japanese t.v., music, and movie clips at the request of the Japan Society for Rights of Authors, Composers and Publishers who complained the clips were copyrighted works.

NBC and CBS have also had disagreements with YouTube even though neither has sued. In 2006, both networks requested at various times that YouTube remove copyrighted clips of their shows from the site including skits from NBC’s Saturday Night Live. YouTube has complied each time and now both networks are actually working with YouTube to show clips of their shows like NBC’s The Office on YouTube. YouTube’s overall strategy regarding copyright infringement appears to be to proactively work with large media companies to avoid lawsuits. For example, YouTube has signed deals within the last sixty days with Warner Music, Sony BMG Music Entertainment, and Universal Music Group to allow the display of copyrighted video and audio in exchange for a portion of advertisement income.

Arthur Chapman’s Intellectual Property Practice Group  is pleased to announce the publication of its completely updated and revised Intellectual Property Law Reference Guide. The Guide provides an overview of IP topics including Trademarks, Copyrights, Deceptive Trade Practices, IP Insurance Coverage, and numerous others. View the Table of Contents for The Guide.

If you would like a complementary copy of The Guide, please contact Arthur Chapman’s Marketing Director, Jenny Frost.

If you have an IP related question or would like to schedule an IP law seminar at your office, please contact Tom Forker or Chris Newkirk.