The Role of Internet Service Providers in Stopping Internet Copyright Infringement. Jennie Ness Regional IP Attaché U.S. Commercial Service

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1 The Role of Internet Service Providers in Stopping Internet Copyright Infringement Jennie Ness Regional IP Attaché U.S. Commercial Service

2 New Means of Distribution Webcasting or Streaming Uploading and downloading Peer-to-peer (P2P) file sharing Can be: Interactive On-demand Real-time

3 Vulnerability of Content in the Digital Age Without protection, perfect copies of digital works can be created and distributed around the world at almost no cost.

4 Internet Piracy is a Real and Growing Threat Napster, Grokster, KaZaA, edonkey, BitTorrent, Gnutella, are just a few examples of peer-to-peer (P2P) networks. Over one BILLION files are copied across peer-to-peer systems every month. Infringing copies of all forms of copyrighted works are increasingly available online. Warez groups crack or rip files and then upload the files to peer-to-peer networks.

5 Purpose of Secondary Liability Secondary liability targets those who achieve illegal results by using others to do the dirty work of breaking the law. Secondary liability also targets those who profit from violations of the law but hide behind a primary offender.

6 International Aspects Different legal systems have different approaches to secondary liability But secondary liability exists under almost all national legal regimes. A country that did not provide for secondary liability in appropriate cases would violate TRIPS. Berne Article 9(1) ( authorizing reproduction ). TRIPS Articles 41(1) & 42.

7 Secondary Liability Today Questions remain whether and how secondary liability will be applied in the bricks and mortar world, for example in the area of landlord liability. But secondary liability is also required tool for dealing with online piracy. Secondary liability is a fundamental requirement for any Internet Service Provider Liability notice and take-down systems that provide a safe harbor for ISPs that take down infringing materials from their networks. Peer-to-peer file sharing networks seek to profit off of perceived loopholes in secondary liability regimes.

8 Secondary Liability Doctrines The two major doctrines are contributory liability and vicarious liability. Contributory liability: Based on culpable acts. Test: Defendant knows or has reason to know of infringement and induces, causes or materially contributes to the infringing conduct of another. Vicarious liability: Based on control. Test: Defendant has a direct financial interest in infringing conduct that she has a right and ability to control. Cases involving landlords, dance halls, department stores, swap meets.

9 New Challenges: ISPs. Legal uncertainty might deter creation of new networks and services. ISPs may have less ability to police infringing uses of their services. Almost all ISPs have inherent disincentives to cooperate with copyright-enforcement efforts. Some ISPs intend to encourage copyright piracy (e.g., Napster, Aimster, Grokster). ISPs that derive revenues from subscriptions or advertising benefit indirectly from piracy that makes their services more popular. ISPs who do not benefit from piracy should still refuse to expend their own resources to help enforce the rights of third parties. But the limitations of IP v.4 addressing ensure that ISPs may hold the information needed to identify an infringer.

10 The Digital Millennium Copyright Act (the DMCA ) The U.S. implements the WIPO Internet Treaties through the Digital Millennium Copyright Act (the DMCA) and other laws. ISP Safe Harbors ( 512(a)-(d)): Harbors for 1) access services, 2) caching services, 3) hosting services, and 4) information-location services. The harbors severely limit the civil remedies available against compliant service providers. Notice-and-Takedown and Information-Subpoena Obligations for Most Harbored ISPs ( 512).

11 The ISP Safe-Harbors: General Principles The harbors provide compliant ISPs with protections against civil liability for infringement: They prohibit monetary relief and strictly limit injunctive relief. Injunctions against most ISPs can include orders necessary to prevent or restrain infringement if no other comparably effective relief would be less burdensome to the provider. During the notice-and-takedown process, all participants can be liable for damages, attorneys fees and costs arising from knowing misrepresentations. ISPs will comply with the safe-harbor requirements only if noncompliant ISPs face a significant risk of liability.

12 What is an ISP? Short for Internet Service Provider, an ISP is a company that provides access to the Internet. For a monthly fee, the service provider gives you a software package, username, password and access phone number(s). Equipped with a modem, you can then log on to the Internet, send and receive , and set up a website of your own. In addition to serving individuals, ISPs also serve large companies, providing a direct connection from the company's networks to the Internet. ISPs are also called IAPs (Internet Access Providers) and OSPs (Online Service Providers).

13 What is an ISP? Functions of ISPs include Transitory communications (serving as an information carrier); System caching; Storage of information on systems or networks at direction of users (hosting); and Information location tools (searching).

14 Transitory Communications ISP acts as a mere data conduit, transmitting digital information from one point on a network to another at a user s request.

15 System Caching Retaining copies, for a limited time, of material that has been made available online by a person other than the ISP. Caching is technologically necessary to ensure Internet speed and efficiency, particularly in terms of providing rapid access to popular content without overloading servers.

16 Information Storage Allowing users to post materials, unchanged. Includes website hosting.

17 Information Location Tools Internet search engines Hyperlinks Internet directories

18 Definition of an ISP: Passive carrier of material selected by a user. ISP cannot send the material itself; ISP cannot choose the material or its recipient; ISP cannot modify the content as sent or received by the user; ISP cannot have knowledge of infringing activity; If the ISP has the ability to control the infringing activity, then it must not receive any financial benefit directly attributable to the infringing content; Upon receiving proper notice of the alleged infringement, the ISP must expeditiously take down or block access to the material; Each ISP must designate an agent to receive notices of claimed infringement.

19 Qualifying for the ISP Safe-Harbors: The term service provider (ISP) includes any entity that provides online services or network access, or the operator of facilities therefor. Harbors are only available to ISPs who: adopt, reasonably implement, and inform subscribers of a policy of terminating service to users who are repeat infringers, and accommodate and do not interfere with standard technical measures, that protect or identify copyrighted works that (1) are developed through open, fair and voluntary multi-industry standards-setting processes, (2) are available to all on reasonable and nondiscriminatory terms, and (3) do not impose substantial costs or burdens on providers, their networks, or their services.

20 Qualifying for the Safe Harbor In order to qualify for the safe harbor liability limitations under the DMCA, an ISP must: Designate an agent to receive statutory notices from copyright owners about infringements and to send statutory notices to affected subscribers. Advise the Copyright Office of the agent's name and address and post that information on its website Develop and post a policy for termination of repeat offenders and provide users with information about copyright laws. Comply with "take down" and "put back" notice requirements. Ensure that the system accommodates industry-standard technical measures used by owners to protect their works from unlawful access and copyright infringement

21 The Hosting Harbor 512(c) protects providers that host infringing materials if they: Host infringing material at the direction of a third party; Lack actual or constructive knowledge that the material, or uses of it, are infringing, or act expeditiously to remove it after acquiring such knowledge; Do not receive a financial benefit directly attributable to infringement that the provider has a right and ability to control; and Respond expeditiously to a notice-and-takedown request.

22 The Information-Location -Service Harbor 512(d) protects providers that provide informationlocation tools that refer or link to infringing materials if they: Lack actual or constructive knowledge that the material, or uses of it, are infringing, or act expeditiously to remove it upon acquiring such knowledge; Do not receive a financial benefit directly attributable to infringement that the provider has a right and ability to control; and Respond expeditiously to a notice-and-takedown request.

23 The Notice-and-Takedown Process: General Principles The notice-and-takedown process provides an alternative to infringement litigation that benefits rightsholders, ISPs, and alleged infringers. For rightsholders, N&T is faster and less expensive than litigation, and it does not foreclose the litigation option. For ISPs, N&T makes them eligible for the certainty provided by safe-harbor provisions. For alleged infringers, N&T can preserve their privacy and avoid a potentially ruinous lawsuit.

24 The Notice-and-Takedown Process: Designating an Agent To claim the benefits of most safe-harbors, an ISP must designate an agent to receive notices of alleged infringement and provide contact information to the public and the U.S. Copyright Office. 37 CFR The designation must include the name, address, phone number, and electronic mail address of the agent Examples of agent designations are available from Copyright Office s listing of designated agents at

25 The Notice-and-Takedown Process: The Notice to the ISP 512(c)(3) provides that a written communication to a provider s designated agent triggers notice-and-takedown obligations if it: Contains a physical or electronic signature of a person who states under penalty of perjury that they are authorized to act on behalf of the relevant copyright holder; Identifies, or provides a representative list of, the works claimed to have been infringed; Provides information reasonably sufficient to permit the provider to locate the material; Enables the provider to contact the complaining party; and States that the complaining party has a good-faith belief that the use of the material complained of is not authorized by the rightsholder or the law. A notice must substantially comply with all of these criteria.

26 The Notice-and-Takedown Process: The Takedown/Put-back Process An adequate notice or appropriate knowledge triggers a duty to expeditiously remove or disable access to infringing materials. The Counter-Notice Process: Hosting-service providers receiving a takedown notice must also: (1) try to notify the subscriber that its hosted materials have been taken down; (2) provide any counter-notice received from that subscriber to the complaining party and notify it that the disputed materials will be replaced or restored in 10 days; and (3) replace or restore access to disputed materials no earlier than 10 and no later than 14 days after receiving the counter-notice unless the complaining party notifies the provider that it has sued the allegedly infringing subscriber. Requirements for a valid counter-notice are similar to those for a notice.

27 What does a Notice Look like? The name, address, and electronic signature of the complaining party [512(c)(3)(A)(i)] The infringing materials and their Internet location [512(c)(3)(A)(ii-iii)], or if the service provider is an "information location tool" such as a search engine, the reference or link to the infringing materials [512(d)(3)]. Sufficient information to identify the copyrighted works [512(c)(3)(A)(iv)]. A statement by the owner that it has a good faith belief that there is no legal basis for the use of the materials complained of [512(c)(3)(A)(v)]. A statement of the accuracy of the notice and, under penalty of perjury, that the complaining party is authorized to act on the behalf of the owner [512(c)(3)(A)(vi)].

28 The Notice-and-Takedown Process: A Sample Notice to an ISP Sender Information: Condé Nast Publications Sent by: [Private] Sabin, Bermant & Gould LLP New York, NY, , USA Recipient Information: [Private] Google, Inc. [Blogger] Mountain View, CA, 94043, USA Sent via: fax Re: Dear Google: February 8, 2006 We represent The Condé Nast Publications, publisher of Vogue magazine. A blog on your sponsored blogging site, at contains what it describes as the cover of the April 2006 issue of Vogue. It may or may not be correct, but either way, that cover has not been published. Conde Nast owns the exclusive right to publish the photograph on the cover and the cover as a whole, and publication by anyone else without Conde Nast s authorization constitutes copyright infringement. The copyright infringement is particularly egregious because it robs Conde Nast of its right of first publication. The nature of the cover photograph, including its subject, subject matter, and photographer, make this photograph particularly valuable. This material must be removed immediately. I cannot find any way to contact the blogger directly. I have a good faith belief that use of the copyrighted materials described above as allegedly infringing is not authorized by the copyright owner, its agent, or the law. I swear, under penalty of perjury, that the information in the notification is accurate and that I am the copyright owner or am authorized to act on behalf of the owner of an exclusive right that is allegedly infringed. [private], Esq. Sabin, Bermant & Gould LLP [private] New York, N.Y Tel. 212[private] Fax. 212[private]

29 The Notice-and-Takedown Process: Data from 2001 to mid-2002 US copyright owners report that during the 18-month period including 2001 and the first half of 2002, the four major associations of U.S. rightsholders sent about 158,300 notices of alleged infringement to ISPs. During this period, these rightsholders received only 13 counter-notices, so only 0.008% of notices were contested by the alleged infringer. N&TT has been very successful at halting infringement and limiting the need for lawsuits against Internet users.

30 The Information-Subpoena Process 512(h) provides a legal process to require ISPs to identify allegedly infringing users of their networks or services. A U.S. District Court clerk must expeditiously issue a subpoena that rightsholders must deliver to an ISP. The subpoena request must include: A copy of a takedown notice, a proposed subpoena; and A sworn declaration that the subpoena is to identify an alleged infringer and that any information obtained will be used only for that purpose.

31 The Information-Subpoena Process A delivered subpoena obligates an ISP to expeditiously disclose to rightsholders or their agents information sufficient to identify the alleged infringer of the material described in the notification, if it is available to the ISP. Using John Doe lawsuits to require ISPs to identify alleged infringers is expensive for all affected parties; it ends an alleged infringer s privacy; and it promotes further litigation to recoup costs.

32 Summary: The Enforcement Regime Established by the DMCA Laws like the DMCA will only deter piracy and promote cooperation if they operate against a strong, flexible civilenforcement system. Rogue ISPs that intend to encourage piracy must still be deterred. ISP-liability limitations cannot encourage cooperation unless the failure to cooperate has consequences.

33 Summary: ISP-Liability Limitations Laws like the DMCA seek to protect the interests of rightsholders, ISPs, and consumers by providing: Strong and flexible legal protections for TPMs Calibrated safe harbors for ISPs that want increased certainty. Notice-and-takedown and information subpoena provisions that provide affordable, swift alternatives to traditional enforcement lawsuits. But laws like the DMCA only protect these interests if they interact properly with other aspects of the legal system.

34 Thank you! Jennie Ness (66)

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