BY:
Neil J. RosiniI. THE FOUR EXEMPTIONS IN SUMMARY
Section 512 provides that a service provider shall not be liable for money damages or, except as explicitly provided, for injunctive or other equitable relief, for infringement of copyright respecting four distinct activities, provided a rather complicated set of conditions is satisfied. The four activities are the following, and the conditions for each are laid out in further detail below.
Before looking at each of the “safe harbors” in detail, first note that the definition of “service provider” — the beneficiary of the four exemptions — is different for the first exemption compared to the other three; secondly, the service provider, in order to enjoy every exemption but the first, must appoint a designated agent to receive notifications of infringement; and thirdly, the service provider must adopt, implement and inform subscribers about a policy that provides for termination of the accounts of repeat infringers. These three criteria that cut across the different exemptions are examined in further detail just below.
Definition of “service provider” varies for the first exemption
The term “service provider” as used in this first exemption is broadly defined, but not as broadly as for the other three exemptions. In the case of section (a) alone, “service provider” means an entity offering the transmission, routing, or providing of connections for digital online communications, between or among points specified by a user, of material of the user’s choosing, without modification to the content of the material as sent or received.” [§512 (k)(1)(A); DMCA §202(k)(1)(A)] The definition of “service provider” that serves for the other three provisions includes within the term’s meaning “a provider of online services or network access, or the operator of facilities therefor” including every provider who fits within the definition for section (a). This more embracing approach for sections (b), (c) and (d) does not automatically exclude providers who (i) modify content; (ii) do more than offer transmission, routing or providing of connections for digital online communications; (iii) do more than merely provide communications between or among points specified by a user; and (iv) do not merely transmit material of the user’s choosing. [§512 (k)(1)(B); DMCA §202(k)(1)(B)])
A Designated Agent must be appointed to enjoy all but the first exemption
To enjoy every exemption but the first, the service provider must appoint a designated agent,* who will be available to receive notices of claimed infringement. The service provider must make the designation of the agent “available through its service, including on its website in a location accessible to the public, and by providing to the Copyright Office substantially the following information … “
The Register of Copyrights also has another job in this scheme: he or she “shall maintain a current directory of agents available to the public for inspection, including through the Internet, in both electronic and hard copy formats, and may require payment of a fee by service providers to cover the costs of maintaining the directory.”
This section also describes the elements of notification required for a notice to be effective:
“(A) To be effective under this subsection, a notification of claimed infringement must be a written communication provided to the designated agent of a service provider that includes substantially the following:
(i) A physical or electronic signature of a person authorized to act on behalf of the owner of an exclusive right that is allegedly infringed.
(ii) Identification of the copyrighted work claimed to have been infringed, or, if multiple copyrighted works at a single online site are covered by a single notification, a representative list of such works at that site.
(iii) Identification of the material that is claimed to be infringing or to be the subject of infringing activity and that is to be removed or access to which is to be disabled, and information reasonably sufficient to permit the service provider to locate the material.
(iv) Information reasonably sufficient to permit the service provider to contact the complaining party, such as an address, telephone number, and, if available, an electronic mail address at which the complaining party may be contacted.
(v) A statement that the complaining party has a good faith belief that use of the material in the manner complained of is not authorized by the copyright owner, its agent, or the law.
(vi) A statement that the information in the notification is accurate, and under penalty of perjury, that the complaining party is authorized to act on behalf of the owner of an exclusive right that is allegedly infringed.
(B)(i) Subject to clause (ii), a notification from a copyright owner or from a person authorized to act on behalf of the copyright owner that fails to comply substantially with the provisions of subparagraph (A) shall not be considered under paragraph (1)(A) in determining whether a service provider has actual knowledge or is aware of facts or circumstances from which infringing activity is apparent.
(ii) In a case in which the notification that is provided to the service provider’s designated agent fails to comply substantially with all the provisions of subparagraph (A) but substantially complies with clauses (ii), (iii), and (iv) of subparagraph (A), clause (i) of this subparagraph applies only if the service provider promptly attempts to contact the person making the notification or takes other reasonable steps to assist in the receipt of notification that substantially complies with all the provisions of subparagraph (A).”
[§512(c)(2), (3); DMCA §202(c)(2), (3)]
A policy must be put into place for termination of repeat infringers
A service provider will not be eligible for any of the exemptions from liability unless it:
“(A) has adopted and reasonably implemented, and informs subscribers and account holders of the service provider’s system or network of, a policy that provides for the termination in appropriate circumstances of subscribers and account holders of the service provider’s system or network who are repeat infringers; and
(B) accommodates and does not interfere with standard technical measures. “
[§ 512(i)(1)(A), (B); DMCA § 202(i)(1)(A), (B)]
By “standard technical measures” is meant:
“technical measures that are used by copyright owners to identify or protect copyrighted works and–
(A) have been developed pursuant to a broad consensus of copyright owners and service providers in an open, fair, voluntary, multi-industry standards process;
(B) are available to any person on reasonable and nondiscriminatory terms; and
(C) do not impose substantial costs on service providers or substantial burdens on their systems or networks.”
[§ 512(i)(2); DMCA § 202(i)(2)]
“Actual knowledge” on the part of the service provider blocks the third and fourth exemptions
The first and second exemptions (i.e., those respecting transitory digital network communications and system caching) are apparently not lost even if the service provider has knowledge of the infringing activity in question. However, the statute specifically states that the third and fourth exemptions (i.e., those respecting storing information on systems or networks at the direction of users and referring or linking users to an online location) will not be available when the service provider has knowledge (i.e. prior to receipt of a complaint) that the material or an activity using the material on the system or network is infringing, or even awareness of facts or circumstances from which infringing activity is apparent. (The meaning of “knowledge” and “awareness of facts or circumstances” is discussed further below.)
II. THE FOUR EXEMPTIONS IN DETAIL
(a) Transitory Digital Network Communications
The exemption in subsection (a) [§512(a); DMCA §202(a)] is available to service providers that offer simply “the transmission, routing, or providing of connections for digital online communications, between or among points specified by a user, of material of the user’s choosing, without modification to the content of the material as sent or received.” [§512(k)(1)(A); DMCA §202(k)(1)(A)]. This exemption applies to “infringement of copyright by reason of the provider’s transmitting, routing, or providing connections for, material through a system or network controlled or operated by or for the service provider, or by reason of the intermediate and transient storage of that material, in the course of such transmitting, routing, or providing connections, if … “
“(1) the transmission of the material was initiated by or at the direction of a person other than the service provider;
(2) the transmission, routing, provision of connections, or storage is carried out through an automatic technical process without selection of the material by the service provider;
(3) the service provider does not select the recipients of the material except as an automatic response to the request of another person;
(4) no copy of the material made by the service provider in the course of such intermediate or transient storage is maintained on the system or network in a manner ordinarily accessible to anyone other than anticipated recipients, and no such copy is maintained on the system or network in a manner ordinarily accessible to such anticipated recipients for a longer period than is reasonably necessary for the transmission, routing, or provision of connections; and
(5) the material is transmitted through the system or network without modification of its content.”
(b) System Caching
This exemption in subsection (b) [§ 512(b); DMCA § 202(b)] only applies to “intermediate and temporary storage of material on a system or network controlled or operated by or for the service provider” of material transmitted in the first instance “at the direction of” an initial recipient, which storage is for the purpose of making the material available more quickly to subsequent users of the service who request access to it.
In detail, the statute says the exemption applies only if:
“(A) the material is made available online by a [source] … other than the service provider,
(B) the material is transmitted from [that source] … through the system or network to [an initial recipient] … other than [the source] … at the direction of that [initial recipient] … , and
(C) the storage is carried out through an automatic technical process for the purpose of making the material available to [subsequent] users of the system or network who, after the material is transmitted as described in subparagraph (B), request access to the material from the [source] … ” provided the following conditions are also met:
“the material … is transmitted to the subsequent users … without modification to its content from the manner in which the material was transmitted from the [source];
“the service provider … complies with rules concerning the refreshing, reloading, or other updating of the material when specified by the [source] .. in accordance with generally accepted industry data communications protocol for the system or network … [as long as the source is not using those rules] to prevent or unreasonably impair the intermediate storage to which this subsection applies.”
“the service provider does not interfere with the ability of technology associated with the material to return to the [source] … the information that would have been available to that [source] … if the material had been obtained by subsequent users … directly from that [source] … ” if that technology (i) ” does not significantly interfere with the performance of the provider’s system or network or with the intermediate storage of the material; (ii) is consistent with generally accepted communications protocols; and (iii) does not extract information from the provider’s system or network other than the information that would have been available to the [source] … if the subsequent user had gained access to the material directly from that [source] … “
“if the [source] … has in effect a condition that a person must meet prior to having access to the material, such as a condition based on payment of a fee or provision of a password or other information, the service provider permits access to the stored material in significant part only to users of its system or network that have met those conditions and only in accordance with those conditions”
“if the [source] … makes that material available online without the authorization of the copyright owner of the material, the service provider responds expeditiously to remove, or disable access to, the material that is claimed to be infringing upon notification of claimed infringement as described [below –see the discussion of the Designated Agent Requirement] … : if and only if “the party giving the notification includes in the notification a statement confirming [accurately] that the material has been removed from the originating [source] site or access to it has been disabled, or a court ordered that the material be removed from the originating [source] site or that access to the material on the originating [source] site be disabled…”
[§512 (b)(1), (2)(A)-(E); DMCA §202(b)(1),(2)(A)-(E)]
(c) Storing Information at the Direction of Users
Subsection (c) [§512 (c); DMCA §202(c)] provides an exemption of liability for service providers “for infringement of copyright by reason of the storage at the direction of a user of material that resides on a system or network controlled or operated by or for the service provider, if the service provider … “
“(A)(i) does not have actual knowledge that the material or an activity using the material on the system or network is infringing;
(ii) in the absence of such actual knowledge, is not aware of facts or circumstances from which infringing activity is apparent; or
(iii) upon obtaining such knowledge or awareness, acts expeditiously to remove, or disable access to, the material;
(B) does not receive a financial benefit directly attributable to the infringing activity, in a case in which the service provider has the right and ability to control such activity; and
(C) upon notification of claimed infringement as described [see the discussion of the Designated Agent Requirement] … responds expeditiously to remove, or disable access to, the material that is claimed to be infringing or to be the subject of infringing activity. “
(d) Referring or Linking Users to an Online Location
Subsection (d) [§512 (d); DMCA §202(d)] provides an exemption of liability for service providers “by reason of the provider referring or linking users to an online location containing infringing material or infringing activity, by using information location tools” such as a directory, index, reference pointer or hypertext link, provided the service provider:
“(1)(A) does not have actual knowledge that the material or activity is infringing;
(B) in the absence of such actual knowledge, is not aware of facts or circumstances from which infringing activity is apparent; or
(C) upon obtaining such knowledge or awareness, acts expeditiously to remove, or disable access to, the material;
(2) does not receive a financial benefit directly attributable to the infringing activity, in a case in which the service provider has the right and ability to control such activity; and
(3) upon notification of claimed infringement as described in …[the part of the Designated Agent section that refers to the prompt action that must be taken by a service provider upon notification of infringement], responds expeditiously to remove, or disable access to, the material that is claimed to be infringing or to be the subject of infringing activity, except that, for purposes of this paragraph, the information described in … .[the part of the Designated Agent section that sets out the information required to be found in a notice of infringement] shall be identification of the reference or link, to material or activity claimed to be infringing, that is to be removed or access to which is to be disabled, and information reasonably sufficient to permit the service provider to locate that reference or link. “
[§512 (d); DMCA § 202(d)].
Meaning of “actual knowledge” and “aware of facts or circumstances”
What is meant by the phrases “actual knowledge,” and “aware of facts or circumstances” in sections (c) and (d)? The Joint Explanatory Statement of the Committee of Conference offers little assistance, but other legislative history shows that Congress intended to remove these safe harbors only when service providers become aware of “red flags” indicating infringement, and then refuse to act. See Robins, Digital Millennium Copyright Act Defenses for Providers of Online Storage Services and Information Location Tools, 16 The Computer Lawyer 6/7 at 11, 15. Moreover, the applicability of the defenses is not conditioned on a service provider monitoring its service or affirmatively seeking acts indicating infringing activity, except to the extent consistent “with a standard technical measure[s]” [§512 (m)(1); DMCA §202(m)(1)] (i.e., “technical measures that are used by copyright owners to identify or protect copyrighted works,” subject to certain qualifications) [§512 (i)(1),(2); DMCA §202(i)(1), (2)].
III. OTHER PROVISIONS
Section 512 of the Copyright Act also provides:
* This obligation is expressly stated for the section (c) exemption and implied for section (b) and section (d) exemptions.