Jun 14

Aereo-decision: Injecting New Uncertainty into the Liability of Online Service Providers

aereo_antenna_arrayTV-over-Internet service Aereo suffered a major defeat yesterday, when the U.S. Supreme Court decided its service infringed on ABC’s copyrights. Aereo offers its subscribers free-to-air TV programming over the Internet. The service depends on thousands of antennas housed in a central warehouse. On Aereo’s website subscribers can select a TV show that will then be tuned into and streamed to the subscriber’s device. For every user watching, Aereo dedicates one antenna, and in order to transcode and stream the show, Aereo stores a copy of the show in a subscriber-specific folder on its servers. Thus, instead of setting up an own antenna to pick up free-to-air TV, one “rents” an antenna from Aereo’s antenna-park to remotely pick up a specific TV show, which is then streamed to an Internet-connected device.

Direct copyright infringement?

The issue before the Supreme Court was whether Aereo publicly performed the TV shows that it picked up and streamed to its subscribers. In other words, whether or not Aereo directly infringed ABC copyrights. The Supreme Court held that Aereo did.

The Supreme Court’s reasoning goes back to two earlier decisions from 1968 and 1974 in which the Court considered the liability of Community Antenna Television (CATV) Systems under copyright law. These CATV Systems, which were the precursors of modern cable systems, picked up local television broadcasting from the air and carried the signals through cables to the television sets of subscribers. In these two decisions, the Supreme Court essentially held that these providers, by receiving and rechanneling the broadcast signals, performed a “viewer function” that was outside of the scope of copyright law. However, Congress, through the 1976 Copyright Act, overturned the Supreme Court decisions and included the functions performed by these CATV systems and other cable companies in the performance right.

Congress’ rejection of the Supreme Court’s CATV decisions to a great extent informs the Supreme Court’s reasoning in Aereo. Because the Court deemed Aereo’s activities “substantially similar” to those of the cable companies, and Congress intentionally brought the activities of the latter within the Copyright Act’s reach, the Court argues that Aereo too performs copyrighted works. The technical differences between Aereo service and the service of cable companies do “not make a critical difference here”, the functional similarities do.

Volitional Conduct

In its decision, the Supreme Court rejects the argument that Aereo’s subscribers transmitted the TV shows to their screens, and not Aereo, which only provided the means to do so. In this argument, Aereo is compared to “a copy shop that provides its patrons with a library card”, which falls outside of the scope of copyright’s exclusive rights.

This argument, in particular the copy shop-analogy has been helpful to internet access providers and other online service providers in shielding them from liability for direct copyright infringement. Already in 1995, in Religious Technology Center v. Netcom on the liability of a Bulletin Board System-provider and an internet access provider for direct infringements, the District Court held that infringement requires an “element of volition or causation.”

The volitional conduct-requirement has not just been applied in other cases of BBS and internet access providers, but made its way to cases dealing with direct liability of hosting service providers that hosted infringing content for others. In these cases the hosting provider is compared to an owner of a public copying machine that does not himself copy, but only provides the means to copy, distribute or display copyrighted works. Also service providers that, through automatic processes are more involved with the content they store, have not been held liable for direct infringement based on the volitional conduct-requirement. The Fourth Circuit Court’s decision in CoStar v. Loopnet, on the liability of real estate listing service Loopnet’s for user-uploaded images, is a good example of that.

The absence of “volitional conduct” does not mean online service providers cannot be held liable for infringements at all. Rather, their liability for involvement in infringements of others is looked at through an indirect infringement lens. This approach allows to take into account notions such as knowledge of and control over the primary infringements. It frees online service providers from copyright’s strict liability regime and its mechanical application, and weighs their involvement in infringements primarily instigated by others.

The Supreme Court’s “limited holding”

Although the Supreme Court in Aereo limits its decision to cable company-like activities, the Court is well-aware of the potential effect its holding may have for online service providers and other providers of innovative technologies. The Court notes:

“In other cases involving different kinds of service or technology providers, a user’s involvement in the operation of the provider’s equipment and selection of the content transmitted may well bear on whether the provider performs within the meaning of the Act. But the many similarities between Aereo and cable companies, considered in light of Congress’ basic purposes in amending the Copyright Act, convince us that this difference is not critical here.”

In particular with regard to remote storage services, the Court notes:

“And we have not considered whether the public performance right is infringed when the user of a service pays primarily for something other than the transmission of copyrighted works, such as the remote storage of content.”

And with regard to new technologies in general:

“Aereo and many of its supporting amici argue that to apply the Transmit Clause to Aereo’s conduct will impose copyright liability on other technologies, including new technologies, that Congress could not possibly have wanted to reach. We agree that Congress, while intending the Transmit Clause to apply broadly to cable companies and their equivalents, did not intend to discourage or to control the emergence or use of different kinds of technologies. But we do not believe that our limited holding today will have that effect.”

Blurring the line between direct infringement and indirect infringement

Although the Supreme Court’s notes that its holding is “limited”, and it provides examples of services to which the holding does not necessarily applies (e.g. remote storage), the Court with its cable system-analogy does blur the line between direct and indirect copyright infringement. Justice Scalia in his dissenting opinion argues that the “this looks like cable TV”-rule opens the door to other analogies and distorts the sharp distinction between direct and indirect infringement:

“Third, and most importantly, even accepting that the 1976 amendments had as their purpose the overruling of our cable-TV cases, what they were meant to do and how they did it are two different questions—and it is the latter that governs the case before us here. The injury claimed is not violation of a law that says operations similar to cable TV are subject to copyright liability, but violation of §106(4) of the Copyright Act. And whatever soothing reasoning the Court uses to reach its result (“this looks like cable TV”), the consequence of its holding is that someone who implements this technology “perform[s]” under that provision. That greatly disrupts settled jurisprudence which, before today, applied the straightforward, bright-line test of volitional conduct directed at the copyrighted work.”

Furthermore, by not providing criteria for determining when the new “looks like cable TV”-rule applies, the Supreme Court creates uncertainty as to whether the conduct of certain online service providers may amount to direct infringement. We have already seen District Courts wrongly applying the volitional conduct requirement to the conduct of certain online service providers (see Arista Records v. Usenet.comCapital Records v. MP3tunes, 2009 WL 2568431; and Perfect 10 v. Megaupload, 2011 WL 3203117), or disregarding the requirement altogether (Arista Records v. Myxer, 2011 WL 11660773). The Supreme Court’s decision in Aereo may only foster more confusion about and misapplication of the volitional conduct requirement.

European perspective

From a European (Union) perspective, the volitional conduct-requirement seems like a sensible criterion to keep online service providers outside of copyright law’s direct infringement realm. Instead of creating ad-hoc exceptions, such as those for transient copies, and amassing an overcomplicated body of  case law on what constitutes a communication to the public, the criterion helps to asks the relevant question: who caused the copy to be made or the work to be communicated? In that regard, it’s too bad the U.S. Supreme Court in Aereo is clouding the direct infringement concept, and with it the distinction between direct and indirect infringement.

Mar 14

Embedding Getty Images: Free or a Trojan Horse?

Getty Images, one of the big players in image licensing, recently announced that it allows free embedding of about 35 million pictures in its database. “Free” in the sense that you do not need to pay a licence-fee to Getty to use the images. But, really free? No. There are a few catches. But first, how does embedding a picture work?

How does it work?
It is really simple. You can search Getty’s database and click on the embed-button (“</>”) when you find a picture that you would like to use. You are then presented with a small piece of HTML-code that you can copy and paste into your website’s code. Below you find an example of an embedded picture. A nice pic of an early morning in the Italian Alps, made by Giorgio Fochesato, clearly sponsored by “gettyimages”:

In an article in the British Journal of Photography, Getty’s policy change towards free non-commercial use is explained by Craig Peters, senior vice president of business development:

“We’re really starting to see the extent of online infringement. […] In essence, everybody today is a publisher thanks to social media and self-publishing platforms. And it’s incredibly easy to find content online and simply right-click to utilise it.”

Getty’s solution is an embed-tool that enables to freely embed Getty images for non-commercial purposes. That of course seems like great news for bloggers and others that want to spice up their websites with nice pictures. Honestly, this blog looks a lot better with pictures on it, doesn’t it?

The conditions for use
The conditions for use of Getty’s images can be found in Getty’s terms. Images may only be used “for editorial purposes (meaning relating to events that are newsworthy or of public interest).”

Images may not be used “(a) for any commercial purpose (for example, in advertising, promotions or merchandising) or to suggest endorsement or sponsorship; (b) in violation of any stated restriction; (c) in a defamatory, pornographic or otherwise unlawful manner; or (d) outside of the context of the Embedded Viewer.”

What is commercial use?
Commercial use seems the be most important bar to use of Getty’s images. The difficulty is of course: how does one define commercial use in this context? Is use on a blog that generates some revenue through advertising commercial use? And what about a big news website? According to Getty Images, both parties would be allowed to freely embed pictures:

“Blogs that draw revenues from Google Ads will still be able to use the Getty Images embed player at no cost. “We would not consider this commercial use,” says Peters. “The fact today that a website is generating revenue would not limit the use of the embed. What would limit that use is if they used our imagery to promote a service, a product or their business. They would need to get a license.” A spokeswoman for Getty Images confirms to BJP that editorial websites, from The New York Times to Buzzfeed, will also be able to use the embed feature as long as images are used in an editorial context.”

Getty thus seems to allow everyone who writes in an “editorial context” to use the Getty images. That is quite revolutionary!

Where is the catch?
Well, there are a few catches. When you embed a picture, you literately import a webpage stored at Getty’s servers into your own webpage. In essence, this means that Getty stays in control over its content. If Getty changes anything to these picture-pages, your webpage automatically changes too. For instance, in its terms, Getty reserves the right to “in its sole discretion to remove Getty Images Content from the Embedded Viewer.” Getty may thus remove pictures from your webpage without you even noticing it.

Getty does not only stay in control of its own content, it also gains control over the content on your webpage. From Getty’s terms:

“Getty Images (or third parties acting on its behalf) may collect data related to use of the Embedded Viewer and embedded Getty Images Content, and reserves the right to place advertisements in the Embedded Viewer or otherwise monetize its use without any compensation to you.”

By embedding Getty’s pictures, you allow Getty to display advertisements on the embedded part in your webpage. And worse, Getty may “monetize” use of the embed-tool, which of course predicts little about what Getty will actualy put on your site. While, as of now there may be no advertisements on top or around embedded pictures, there may be in the near future:

“Getty Images will also look to draw additional revenues from its player through advertising. “We reserve the right to monetise that footprint,” Peters explains. “YouTube implemented a very similar capability, which allows people to embed videos on a website, with the company generating revenue by serving advertising on that video.” And while Getty Images has yet to determine how these ads will appear, Peters is confident that this capability will be introduced in the near future.”

But there is more. From the above outtake from Getty’s terms, it also becomes clear that Getty, or others on behalf of Getty, may collect data from your website. That points in the direction of a new business for Getty: with its embedding tool, Getty hopes to jump on the data collection train. With every embedded picture on a webpage, Getty has a beacon on that webpage that allows it to receive “data related to use of the Embedded Viewer and embedded Getty Images Content”, including data on visitors of your website. That is of course a vague description of the data that Getty could gather, which makes the privacy-implications of embedding Getty images hard to predict. Getty could collect only innocent data on for instant how many times an image is used, but it could also bring Getty closer to building a Googlesque database on internet use. Either way, one thus better updates his privacy policy to inform his vistors when allowing in this possible trojan horse.

Feb 14

Remaining questions after the CJEU’s decision in the Svensson-case

The wait is over. After only having access to the Court’s press release on its Svensson-decision, finally the actual decision is out. In my earlier post on the case, I set out the questions that the European Court of Justice had to answer:

In short, the main question that was asked to Court was whether the creation of a link to a work on a website, constitutes a communication to the public in the sense of the Infosoc Directive. In other words, whether linking to copyright-protected materials is an act that is relevant under EU copyright law. It doesn’t need much explanation that this decision touches on the core of the operation of the web. If linking to copyright-protected materials is a communication to the public, then almost all linking on the web amounts to copyright infringement. One would need a licence to link to another’s webpage and that would mean the end of the web as we know it.

The Court is also asked whether it makes a difference if the link refers to a website that can be accessed by anyone without restrictions, or if access is restricted. Also, the question whether any distinction should be made between links that point to another website, and links that display the work “in such a way as to give the impression that it is appearing on the same website” is asked. This last question deals with what is often called “framing”, which is the incorporation of content on a webpage that is stored at another location on the web.

The Court’s answers

Now, what are the Court’s answers? In answering the first question (is a link a communication to the public?), the Court first explains that the concept of a communication to the public includes two cumulative criteria. There should be an “act of communication” of a work and the communication of that work to a “public”.

For there to be an ‘act of communication’, the Court argues that “it is sufficient […] that a work is made available to a public in such a way that the persons forming that public may access it, irrespective of whether they avail themselves of that opportunity”. In arguing that the linking done in this case is an “act of communication” the Court points to the fact that the links on the website in question provided links that afforded users of that website direct access to works published on another website. On the “act of communication”, the Court concludes:

It follows that, in circumstances such as those in the case in the main proceedings, the provision of clickable links to protected works must be considered to be ‘making available’ and, therefore, an ‘act of communication’, within the meaning of that provision.

Regarding the second requirement, that of the ‘public’, the Court reiterates that the term means “an indeterminate number of potential recipients and implies, moreover, a fairly large number of persons.” The Court then notes that a “manager of a website” fulfils this requirement when he places links on a website. He then is making a communication to the public:

An act of communication such as that made by the manager of a website by means of clickable links is aimed at all potential users of the site managed by that person, that is to say, an indeterminate and fairly large number of recipients. In those circumstances, it must be held that the manager is making a communication to a public.

However, the Court notes that in its earlier decisions it held that when a work  is “re-communicated” by the same technical means, the communication should be directed at a “new” public:

“[A] communication, such as that at issue in the main proceedings, concerning the same works as those covered by the initial communication and made, as in the case of the initial communication, on the Internet, and therefore by the same technical means, must also be directed at a new public, that is to say, at a public that was not taken into account by the copyright holders when they authorised the initial communication to the public […].”

The Court then goes on to say that in this particular case, there was no new public. As the work that was linked to was available to everyone on the internet, without any “restrictive measures”, no new public was reached with the communication. In a complicated paragraph the Court then says that if the linked-to content can be accessed by internet users directly on the original site, regardless of the website that provided the link, then those internet users are not a new public:

“In those circumstances, it must be held that, where all the users of another site to whom the works at issue have been communicated by means of a clickable link could access those works directly on the site on which they were initially communicated, without the involvement of the manager of that other site, the users of the site managed by the latter must be deemed to be potential recipients of the initial communication and, therefore, as being part of the public taken into account by the copyright holders when they authorised the initial communication.”

On this issue, the Court concludes that:

“Therefore, since there is no new public, the authorisation of the copyright holders is not required for a communication to the public such as that in the main proceedings.”

Here’s where my first question arises: The Court says that linking is a communication to the public. But if the act of linking does not reach a new public, then “authorisation of the copyright holders is not required.” The Court here almost seems to present non-new-public-linking as an exception to the right of communication. I am assuming that this is not what the Court means. But, what does the Court mean?

Also when dealing with “framing”, of which the Court says that it makes no difference, the Court again notes that no authorization is needed for non-new-public-linking:

That additional circumstance in no way alters the conclusion that the provision on a site of a clickable link to a protected work published and freely accessible on another site has the effect of making that work available to users of the first site and that it therefore constitutes a communication to the public. However, since there is no new public, the authorisation of the copyright holders is in any event not required for such a communication to the public.

My second question is on the Court’s paragraph in which it draws the mirror image of its conclusion:

On the other hand, where a clickable link makes it possible for users of the site on which that link appears to circumvent restrictions put in place by the site on which the protected work appears in order to restrict public access to that work to the latter site’s subscribers only, and the link accordingly constitutes an intervention without which those users would not be able to access the works transmitted, all those users must be deemed to be a new public, which was not taken into account by the copyright holders when they authorised the initial communication, and accordingly the holders’ authorisation is required for such a communication to the public. This is the case, in particular, where the work is no longer available to the public on the site on which it was initially communicated or where it is henceforth available on that site only to a restricted public, while being accessible on another Internet site without the copyright holders’ authorisation.

The Court, in the first sentence seems to focus on links that “circumvent restrictions put in place” on the original website that is linked to. In such a case, a new public is reached through linking to that content, because this part of the public was not considered when the original communication was authorized. The examples that popped up in my head were: circumventing a paywall, or linking to content that is otherwise closed to the general public, for instance by requiring a password for access to the content.

However, in the second part in which the Court explains what it means with its mirror-image, the Court seems to argue that other types of linking may too be an infringement of the right of communication to the public.

This is the case, in particular, where the work is no longer available to the public on the site on which it was initially communicated or where it is henceforth available on that site only to a restricted public, while being accessible on another Internet site without the copyright holders’ authorisation.

Linking to non-authorized content, when that content is available from an authorized source elsewhere, thus seems to reach a new public and may be a communication to the public. Thus, linking to unauthorized communications is not safe? This relates to what Martin Husovec notes when he speaks of the “assumption of the authorized source” that the Court has in dealing with the Svensson-questions.

That’s it for now. I am sure the exact meaning of the Court’s decision will be hotly-debated during the upcoming days, weeks, months and years…