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Court clarifies safe harbor protection
The Digital Millennium Copyright Act
Online platforms that allow users to upload content often rely on the so-called “safe harbors” under the Digital Millennium Copyright Act (DMCA) to shield themselves from copyright infringement claims. A recent ruling from the U.S. Court of Appeals for the Second Circuit serves as a useful reminder, though, that the protection is far from absolute.
Case snapshot
Elliott McGucken is a professional photographer. Hundreds of his photographs began appearing on Shutterstock’s online stock photo marketplace between 2018 and 2022, without his knowledge or consent.
McGucken sued Shutterstock for copyright infringement. The trial court dismissed the case before trial, finding that Shutterstock was protected from the infringement claim based on a DMCA safe harbor. McGucken appealed.
The court’s focus
The trial court found that Shutterstock satisfied all of the criteria required to qualify for the safe harbor. The company met the three “threshold criteria” because it:
- Fell within the broad definition of a “service provider” (that is, a provider of online services or network access),
- Implemented a policy for terminating repeat infringers who use its platform, and
- Didn’t interfere with standard technical measures used by copyright owners to identify or protect copyrighted works.
But Shutterstock also needed to satisfy the criterion particular to the specific safe harbor it invoked. The provision protects providers from liability that would arise “by reason of storage [of infringing materials] at the direction of the user.”
To qualify, a service provider can’t possess “actual” or “red flag” knowledge of infringement. The latter arises when the provider is subjectively aware of facts that made the specific infringement objectively obvious to a reasonable person.
On appeal, the Second Circuit found no actual or red flag knowledge on Shutterstock’s part. It nonetheless concluded that the lower court’s pretrial dismissal was improper because there were still “triable issues of fact” (that is, issues that should be resolved after a full trial, rather than before) concerning two additional requirements.
First, the court said Shutterstock didn’t establish that alleged infringement was “by reason of the storage at the direction of a user” of user-uploaded material on its platform. The question is whether the service provider played a sufficiently active role in the process by which material appeared on its platform, to the extent that its storage and display of infringing material is no longer meaningfully at the user’s direction.
The provider’s review of user materials is central to the analysis. According to the court, the safe harbor doesn’t apply if the provider, on a case-by-case basis, imposes its aesthetic, editorial or marketing judgment to determine which uploads it accepts. Because evidence suggested Shutterstock’s review of user images wasn’t just cursory or automatic, a trial was necessary on the issue.
Second, Shutterstock was also required to establish that it lacked the “right and ability to control” infringing content. This analysis turns on the degree of influence the provider exerted over the content on its platform.
The question here is whether Shutterstock’s image pipeline — which included lengthy guidelines for successful submissions and manual review of every image — gave it substantial control over the images that appeared on its platform. A reasonable judge or jury, the court said, could conclude that the advice and instruction Shutterstock provided its contributors, coupled with the screening process, constituted substantial influence that preempted the safe harbor’s protection.
Digital dilemma
DMCA safe harbors provide valuable protection for service providers. However, providers can forfeit that protection based on the extent of their involvement in determining which content appears on their platforms. Providers must balance the amount of control they exercise against the risk of liability.
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