Ninth Circuit Reverses District Court in Ellison v. AOL: Whether AOL Comes Within DMCA Safe Harbor Is Remanded for Trial
In a significant decision, the United States Court of Appeals for the Ninth Circuit held that AOL should stand trial on a claim that its subscribers had access to unauthorized digital copies of copyrighted works that were posted on “USENET,” a peer-to-peer (“P2P”) file sharing network, and temporarily stored and retained on AOL’s servers. In Ellison v. AOL, Inc., No. 02- 55797 (9th Cir. Feb. 10, 2004), the Ninth Circuit ruled that the district court had improperly granted summary judgment for AOL, when there was a reasonable question whether AOL had properly met the DMCA’s “safe harbor” for Internet service providers.
In the underlying dispute, copyright owner and science fiction author Harlan Ellison filed suit against AOL based upon a subscriber’s posting of Mr. Ellison’s copyright-protected short stories to “USENET.” The Complaint alleged that AOL was liable for copyright infringement under traditional theories of either direct or vicarious liability and/or contributory infringement. AOL moved for summary judgment, seeking dismissal on the grounds that (1) no reasonable trier of fact could conclude, from the evidence, that it was liable for copyright infringement; and (2) at any rate, AOL was shielded from liability pursuant to the “safe harbor” provision of the Digital Millennium Copyright Act (“DMCA” or “the Act”).
Enacted in 1998, the DMCA, 17 U.S.C. § 512, established limitations on liability for copyright infringement of works available online. The Act identified certain categories of service providers—such as those that transmit, cache, or link—that cannot be held liable for certain acts of infringement by subscribers if they comply with specific provisions addressing those particular technologies and come within the DMCA’s “safe harbor” provisions. AOL sought protection under section 512(a), which exempts ISPs that merely transmit, route, provide connections for, or provide “intermediate and transient storage of,” copyrighted works, under certain circumstances. In order to obtain the benefit of that safe harbor, ISPs must also meet two conditions applicable to all ISPs, whether they transmit, cache, or link. First, the ISP must adopt, reasonably implement, and inform subscribers about a policy providing for terminating, in appropriate circumstances, subscribers who are “repeat infringers.” 17 U.S.C. § 512(i)(1)(A).
Second, the ISP must accommodate, and not interfere with, any “standard technical measures” that are “used by copyright owners to identify or protect copyrighted works.” Id. at §§ 512(i)(1)(B), (i)(2).
The district court had granted summary judgment to AOL and dismissed the case, on grounds that AOL qualified for a limitation on liability as a passive “[t]ransitory” communications network provider under section 512(a), and that it had complied with the “safe harbor” provisions of section 512(i). Ellison v. Robertson, 189 F. Supp. 2d 1051 (C.D. Cal. 2002) (Cooper, J.). The district court found it irrelevant that AOL had never actually terminated a subscriber for copyright infringement. The district court’s analysis on this particular point has been closely studied by ISPs seeking to measure their own policies for terminating “repeat infringers,” and had already been questioned by a different judge in another DMCA case in the same court.
The Ninth Circuit agreed with the district court that AOL was not vicariously liable for P2P file sharing under traditional copyright law jurisprudence, but that a reasonable fact-finder could conclude that AOL had materially contributed to infringement. Thus, application of the DMCA’s safe harbor was crucial to AOL’s defense. However, in reversing the district court, the Ninth Circuit considered AOL’s actual policies in handling copyright infringement claims to be triable issues of fact. Before filing suit, Mr. Ellison had allegedly attempted to notify AOL of the infringing conduct by emailing AOL’s registered “designated agent” contact email address. However, AOL had changed its “designated agent” email address, failed to register the change with the Copyright Office, and failed to forward or respond to emails sent to the former address.
The Ninth Circuit held that a trier of fact could conclude that AOL had failed to “reasonably implement” a policy against repeat infringers and would thus be ineligible for the safe harbor defense.1 As such, the Court ruled, Ellison’s claims should go to trial rather than be dismissed on summary judgment.
The decision is noteworthy because it indicates that, at least in the Ninth Circuit, online service providers will have greater difficulty obtaining pre-trial dismissal of copyright infringement suits, with respect to online infringement by subscribers, and providers’ actual DMCA compliance efforts will be subject to increasing scrutiny. If you have any questions about the Ninth Circuit’s decision or the DMCA “safe harbor” for online service providers, please contact us.
1 The Court of Appeals’ reference to AOL’s “designated agent” address implicates section 512(c) of the DMCA concerning ISPs that “host” and that are further subject to “notice and takedown” requirements. Section (c) was not at issue in Ellison although the Court of Appeals considered the “designated agent” status as part of its analysis of “reasonable implementation” of a policy under section 512(i) applicable to ISPs that simply “transmit” under section 512(a). In addition, AOL’s temporary storage of the allegedly infringing material posted on the USENET site (as recounted in the decision) may implicate section 512(b) of the DMCA addressing ISPs that “cache.”