Google’s rumored $1.65 Billion dollar purchase of YouTube has widely reported. Google has reached agreement with a number of major producers of video content to show their work on YouTube. Apparently negotiations with Viacom have hit an impasse and Viacom upped the ante by filing a $1Billion suit against Google. One question is how well grounded are the damage models upon which this litigation is based. Stated differently, YouTube reportedly had negligible revenue and no profit history. (This has caused some to question the Google purchase price.) How can Viacom claim $1Billion in damages?
Viacom is a major media producer and owns MTV, BET as well as interests in Paramount Pictures and Dream Works.
The Viacom/Google litigation revolves around the copyright law generally and the Digital Millennium Copyright Act (DMCA). Specifically, Google is claiming the benefit of the safe harbor created in the DMCA for Internet service providers. Simply stated, the service provider does not need to police their website for work violating copyright (how could they?). However, if a copyright owner complains of content violating their copyright, the service provider is obligated to take it down.
Interestingly, Viacom is stating that Google is using this safe harbor provided to service providers in bad faith. What Viacom is stating is that some programming, popular on YouTube, would clearly be known to be the property of Viacom and Google should be reaping the benefits of the audience while it waits for Viacom to discover the particular film clip and issue a take down notice.
Although the DCMA is already the subject of other articles on this site, for example, The Digital Millennium Copyright Act, and Digital-Millennium Kazaa it is worth repeating that Title 17, Chapter 5, Section 512 provides a limitation of liability relating to material online. A “service provider” is not subject to monetary damages if (i) the transmission of the material was initiated by or at the direction of a third party, (ii) the transmission, routing, or storage is carried out through automatic technical process without selection by the material provider, (iii) the service provider does not select the recipients of the material, (iv) no copy of the material is made by the service provider, and (v) the material is transmitted without modification of content.
The remedies available to the owner of the copyrighted material, e.g., Viacom, include seeking an injunctive order upon the service provider (i) prohibiting access to the material, (ii) terminating the access by the account holder engaged in the infringing activity, and (iii) other injunctive relief.
Finally, Viacom has made its material available for free viewing on Joost under a content licensing arrangement. Apparently viewers will need to download software to allow the viewing.