Today’s guest post comes from Copyhype contributor Devlin Hartline.

Judge Posner’s opinion for the Seventh Circuit in Flava Works, Inc. v. Gunter has caused quite a bit of confusion, to say the least. As Terry Hart mentioned in his post last Monday, the headlines “showcase some of the shortcomings consistently seen in legal reporting.” That’s the diplomatic way of saying that the reporting from the “usual suspects” is bogus and misleading.

Here’s a further sampling of the cheerful headlines:

And my personal favorite:

That, of course, isn’t quite what Judge Posner said.

See if you can spot the syllogistic fallacy:

Major premise: Users embedded infringing videos on the myVidster website.

Minor premise: Judge Posner, confined to the particular facts of the partially-developed record before him (including the fact that there was no evidence that myVidster had encouraged or induced anyone to upload, embed, or stream any infringing videos) and limited by the particular arguments raised by the plaintiff (which only argued non-inducement contributory infringement), found that plaintiff Flava Works was not likely to be successful on the merits of its contributory infringement claim against myVidster for the user-embedded infringing videos.

Conclusion: All embedded infringing videos are totally legal. Hooray!

I’m still shaking my head.

Just because Judge Posner did not find infringement by myVidster for the particular embedded infringing videos at issue in the appeal, it doesn’t follow that all embedded infringing videos are therefore legal. That’s like saying that since a jury acquits one defendant in a prosecution for a shooting death, then all shootings that result in death must be legal.

One must separate out the general statements of law made by the court from the application of the law to the particular facts of the case. And with this opinion, that’s not the easiest thing to do—the opinion leaves much to be desired as far as clarifying exactly what the liabilities are for embedded infringing videos.

Nonetheless, I created tables of the potential liabilities identified by Judge Posner for uploading and streaming infringing videos and posted it to Scribd. Seeing it in tabular form, for me anyway, is quite helpful, and I welcome readers to see what I came up with (and to disagree in the comments if you read the case differently).

With amici like these…

The amicus brief filed in the Seventh Circuit by Google and Facebook, purporting to be in support of neither party (although Judge Posner wisely notes that the brief is “friendly to myVidster”), says it all:

II. Linking can potentially be contributory or vicarious copyright infringement under some circumstances.

To say that linking can never be direct copyright infringement is not to say that linking can never lead to copyright liability of any sort. Copyright law has well-developed doctrines of secondary liability—contributory infringement and vicarious infringement—which can hold liable a culpable party when that party has not, himself, done an act which directly infringes one of the exclusive rights. The specific requirements of these doctrines may be inquired into in the context of linking in the same way that they are applied to any other activity. ***

Thus, holding that myVidster is not a direct infringer—or that its users are not direct infringers—will not leave Flava Works without a path to a possible remedy. If Flava Works can show that myVidster or its users had knowledge of infringement and that their activities were intended to materially contribute to that infringement, myVidster or its users could potentially be liable as contributory infringers. If Flava Works can show that myVidster or its users had the right and ability to supervise the particular infringing performances and also had a direct financial interest in those performances, myVidster or its users could potentially be liable as vicarious infringers.

Brief of Amici Curiae Google Inc. and Facebook, Inc. in Support of Neither Party at 16-17, Flava Works, Inc. v. Gunter, No. 11-3190, 2012 WL 3124826 (7th Cir. Aug. 2, 2012) (emphasis added).

So even Google and Facebook agree that the user-embedded infringing videos on myVidster potentially make it liable for copyright infringement. Though, in their opinion, myVidster could only be liable as a contributory or vicarious infringer, and not as a direct infringer.

Suffice it to say that those claiming that sites hosting user-embedded infringing videos can never be liable for copyright infringement are just plain wrong. The fact that Google and Facebook admit as much should tell you how settled the principle is—few have more to lose on that score. If anyone were to deny it, it’d be them.

A linking site like myVidster can be liable as a secondary infringer, i.e., for contributory infringement (which includes inducement, as per Grokster) or for vicarious infringement. Such sites are not always liable, nor are they always free from liability. What matters is the role that the site plays in the underlying infringement, and that analysis must be done on a case-by-case basis as it is fact-intensive.

A bundle of rights

So what did Judge Posner actually say?

Recall that copyright is actually a bundle of rights:

§ 106. Exclusive rights in copyrighted works

Subject to sections 107 through 122, the owner of copyright under this title has the exclusive rights to do and to authorize any of the following:

(1) to reproduce the copyrighted work in copies or phonorecords;

(2) to prepare derivative works based upon the copyrighted work;

(3) to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending;

(4) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and motion pictures and other audiovisual works, to perform the copyrighted work publicly;

(5) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic, or sculptural works, including the individual images of a motion picture or other audiovisual work, to display the copyrighted work publicly; and

(6) in the case of sound recordings, to perform the copyrighted work publicly by means of a digital audio transmission.

17 U.S.C.A. § 106 (West 2012).

So there are actually six different copyright rights: (1) reproduction, (2) derivation, (3) distribution, (4) public performance, (5) public display, and (6) public performance (for digital audio transmissions of sound recordings). When we say that a certain act does or does not violate someone’s copyright rights, we have to be careful to say which right in particular we’re talking about. The same act can violate one right but not another; in fact, this is almost always the case.

Turning to the opinion, Judge Posner states:

Is myVidster therefore a contributory infringer if a visitor to its website bookmarks the video and later someone clicks on the bookmark and views the video? myVidster is not just adding a frame around the video screen that the visitor is watching. Like a telephone exchange connecting two telephones, it is providing a connection between the server that hosts the video and the computer of myVidster’s visitor. But as long as the visitor makes no copy of the copyrighted video that he is watching, he is not violating the copyright owner’s exclusive right, conferred by the Copyright Act, “to reproduce the copyrighted work in copies” and “distribute copies … of the copyrighted work to the public.” 17 U.S.C. §§ 106(1), (3). ***

As the record stands (a vital qualification, given that the appeal is from the grant of a preliminary injunction and may therefore be incomplete), myVidster is not an infringer, at least in the form of copying or distributing copies of copyrighted work. The infringers are the uploaders of copyrighted work. There is no evidence that myVidster is encouraging them, which would make it a contributory infringer.

Flava Works, Inc. v. Gunter, No. 11-3190, 2012 WL 3124826, *3-4 (7th Cir. Aug. 2, 2012) (emphasis added).

Take a moment to parse what Judge Posner actually said. Here, he’s talking only about the reproduction and distribution rights, numbers (1) and (3) in Section 106. He is not talking about the public performance right, number (4) in Section 106, or any of the other three copyright rights.

Judge Posner says that the party that uploaded the infringing video to the internet is an infringer since that party actually caused a copy to be made. And if myVidster encouraged or induced that party to upload the infringing video, it would be a contributory infringer to that infringement. But users of myVidster who thereafter merely stream that infringing video are not infringers of the reproduction or distribution rights since they have made no copies.

This is important: Judge Posner did not say that streaming infringing videos is legal (it’s not). He did not say that streaming infringing videos does not violate the public performance right (it does). He said that users who stream embedded infringing videos on the myVidster website do not violate the reproduction or distribution rights of the copyright holder. And since that streaming does not violate those two rights, by extension, myVidster is not a contributory infringer for facilitating that specific noninfringing conduct.

It should be noted that whether a streamer actually makes a copy is actually a debatable point, as Terry Hart points out in his post. The record in this case did not disclose whether copies were actually made when someone streamed an embedded infringing video using the myVidster website. Had the record indicated otherwise, it’s likely that the court would have reached a different conclusion on this point.

The public performance right

Judge Posner, like amici Google and Facebook, acknowledges that streaming an infringing video violates the public performance right. And if a website like myVidster significantly encourages or induces that infringement, it could be liable as a contributory infringer.

The opinion is a little confusing on this point, because Judge Posner provides two different interpretations of what it takes to violate the public performance right. The first interpretation is that merely making an infringing video available via a link is by itself direct infringement, while the second interpretation requires that someone have actually used the link to stream the infringing video before there is an infringement.

Either way, it’s clear that the second interpretation swallows the first; there is no doubt that streaming an infringing video is a violation of the public performance right. Judge Posner does not decide the issue of whether merely making the video available via a link suffices, but as Barry Sookman points out, there is reason to think that it does.

Judge Posner continues:

But if the public performance is the transmission of the video when the visitor to myVidster’s website clicks on the video’s thumbnail (the second interpretation) and viewing begins, there is an argument that even though the video uploader is responsible for the transmitting and not myVidster, myVidster is assisting the transmission by providing the link between the uploader and the viewer, and is thus facilitating public performance. ***

In contrast, Flava’s pirated videos are not sold, and there isn’t even admissible evidence that they’re actually being accessed via myVidster, rather than via other websites, and if they are not, myVidster is not contributing to their performance.

Id. at *8 (emphasis added).

Did you catch what Judge Posner said there? There was no admissible evidence that anyone had actually streamed one of plaintiff Flava Works’ videos using the myVidster website. And so, as with the reproduction and distribution rights discussed above, myVidster cannot be a contributory infringer unless it has actually facilitated infringing conduct.

Nor was there any evidence that myVidster had encouraged or induced anyone to embed infringing videos. So even if merely making an infringing video available via a link is itself direct infringement, myVidster would not be liable for that infringement either—not unless there was evidence that it had played a role in encouraging or inducing the person that posted the link.

Note what Judge Posner didn’t say. He did not say that there was no infringement because streaming an infringing video is not an infringement of the public performance right. He said that myVidster was not an infringer because there was no evidence that it had encouraged or induced anyone to embed an infringing video and there was no evidence that anyone actually used the myVidster website to stream an infringing video.

As I said above, whether or not a linking website like myVidster is liable for infringement must be determined on a case-by-case basis because it is a fact-intensive inquiry. Change the facts and the answer likely changes too.

The “Server Test”

I don’t think anyone else has reported as much, but I think that Judge Posner did in fact adopt the “server test” for the public performance right in the Seventh Circuit.

The “server test” comes from the district court in Perfect 10 v. Google, Inc.:

Under the server test, someone could create a website entitled “Infringing Content For All!” with thousands of in-line links to images on other websites that serve infringing content. That website, however, would be immune from claims of direct infringement because it does not actually serve the images. [footnote 10: That website, however, might still be held liable for secondary infringement.] ***

The Court concludes that in determining whether Google’s lower frames are a “display” of infringing material, the most appropriate test is also the most straightforward: the website on which content is stored and by which it is served directly to a user, not the website that in-line links to it, is the website that “displays” the content. Thus, the Court adopts the server test, for several reasons.

Perfect 10 v. Google, Inc., 416 F.Supp.2d 828, 839-43 (C.D. Cal. 2006) (emphasis added).

The Ninth Circuit, in Perfect 10 v. Amazon.com, Inc., affirmed in part and reversed in part, adopting the “server test” circuit-wide in the process:

In considering whether Perfect 10 made a prima facie case of violation of its display right, the district court reasoned that a computer owner that stores an image as electronic information and serves that electronic information directly to the user (“i.e., physically sending ones and zeroes over the [I]nternet to the user’s browser”) is displaying the electronic information in violation of a copyright holder’s exclusive display right. Conversely, the owner of a computer that does not store and serve the electronic information to a user is not displaying that information, even if such owner in-line links to or frames the electronic information. The district court referred to this test as the “server test.”

Applying the server test, the district court concluded that Perfect 10 was likely to succeed in its claim that Google’s thumbnails constituted direct infringement but was unlikely to succeed in its claim that Google’s in-line linking to full-size infringing images constituted a direct infringement. As explained below, because this analysis comports with the language of the Copyright Act, we agree with the district court’s resolution of both these issues.

Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 1146, 1159-60 (9th Cir. 2007) (internal citations omitted) (emphasis added).

The “server test” is simple. The website server that actually sends out the infringing ones-and-zeroes is the one that directly violates the public display right, number (5) in Section 106. Another website that merely links to the infringing content does not directly violate the public display right—it can indirectly violate that right, therefore making it a contributory or vicarious infringer, but it doesn’t directly infringe that right.

It’s important to note that the “server test” argument is not over whether a linking website can be an infringer. It can. The argument is over whether that website is a direct or an indirect infringer. The “server test” says that, at worst, a website that links to infringing material is a contributory or vicarious infringer—still subject to the full range of remedies provided by the Copyright Act, mind you. In a sense, the argument is over whether they’re the bank robber or the getaway driver—it’s difficult to see how it really matters since both are liable for the robbery.

The only difference I can think of (and I haven’t directly researched the point) is that of knowledge: Direct infringers are liable for infringement whether they know of it or not, since direct infringement is a strict liability tort. Contributory infringers, on the other hand, must have knowledge, either actual or implied, of the infringement before any liability attaches.

Given the DMCA safe harbors (that absolve a linking website of most liability so long as it doesn’t have actual or implied knowledge of the underlying infringement) and the Netcom line of cases (that absolve a linking website of liability absent volitional conduct on its part to cause the infringement), it’s hard to see how it really matters. Whether direct or indirect liability is at stake, a linking site is not going to be liable unless it knows of and by its action (or inaction) causes the infringement.

In Flava Works Inc. v. Gunter, the district court below rejected the “server test” argument for the public performance right, number (4) in Section 106:

We decline to apply Perfect 10 to this case. The Ninth Circuit’s decision is not binding on this court; moreover, it is highly fact-specific and distinguishable. Defendants assert that the cases involve “essentially the same technology.” Both cases may involve inline linking, but the processes are quite different. The relevant comparison is between the conduct of Google and the conduct of myVidster’s users, not between Google and myVidster. In response to a search query, Google’s image search engine uses an automated process to display search results through inline linking. In contrast, myVidster’s users do not employ any sort of automation to determine which videos they bookmark; rather, they personally select and submit videos for inline linking/embedding on myVidster. (And many of those hand-picked videos are infringing.) Google’s use of inline linking is neutral to the content of the images; that of myVidster’s users is not.

To the extent that Perfect 10 can be read to stand for the proposition that inline linking can never cause a display of images or videos that would give rise to a claim of direct copyright infringement, we respectfully disagree. In our view, a website’s servers need not actually store a copy of a work in order to “display” it. The fact that the majority of the videos displayed on myVidster reside on a third-party server does not mean that myVidster users are not causing a “display” to be made by bookmarking those videos. The display of a video on myVidster can be initiated by going to a myVidster URL and clicking “play”; that is the point of bookmarking videos on myVidster—a user can navigate to a collection of myVidster videos and does not have to go to each separate source site to view them.

Flava Works, Inc. v. Gunter, No. 10-cv-06517, 2011 WL 3876910, *3-4 (N.D. Ill. Sept. 1, 2011) (emphasis added).

On appeal, Judge Posner disagrees:

By listing plays and giving the name and address of the theaters where they are being performed, the New Yorker is not performing them. It is not “transmitting or communicating” them.

Is myVidster doing anything different? To call the provision of contact information transmission or communication and thus make myVidster a direct infringer would blur the distinction between direct and contributory infringement and by doing so make the provider of such information an infringer even if he didn’t know that the work to which he was directing a visitor to his website was copyrighted. Then he would have to search for a safe harbor in the Digital Millennium Copyright Act. myVidster doesn’t touch the data stream, which flows directly from one computer to another, neither being owned or operated by myVidster.

Flava Works, Inc. v. Gunter, No. 11-3190, 2012 WL 3124826, *7-8 (7th Cir. Aug. 2, 2012) (internal citations omitted) (emphasis added).

It’s subtle. Judge Posner doesn’t come right out and say that he’s adopting the “server test” for the public performance right in the Seventh Circuit. But the opinion makes clear that he thinks that holding myVidster liable as a direct infringer goes too far since that would mean holding it liable even if it had no knowledge of the underlying infringement and even though the ones-and-zeroes didn’t actually cross its server.

Thus, similar to the Ninth Circuit in Perfect 10, which found that linking to infringing images only creates indirect liability for infringement of the display right, number (5) in Section 106, the Seventh Circuit here found that myVidster, which links to infringing videos, could only be liable as an indirect infringer of the public performance right, number (4) in Section 106. In other words, both courts found that linking cannot give rise to direct liability for infringement.

Again, given the DMCA safe harbors and the Netcom line of cases, I’m not convinced that Judge Posner’s concern about strict liability is merited—it’s not like every linking site will be directly liable for every link it provides to infringing material. The safe harbors still protect it and there has to be volitional conduct on its part in providing the links. It’s clear though that Judge Posner thinks myVidster’s connection to the underlying infringement is too remote to hold it liable as a direct infringer because the ones-and-zeroes don’t cross its server.

Personally (and similar to the district court below), I think the “server test” elevates form over function, and the better view is that a link to an infringing video directly causes a public performance to occur when clicked—that is its very purpose. Whether or not the ones-and-zeroes cross the server providing the link misses the point: It’s a necessary link in the chain, without which, there would not be the particular infringement.

It will be interesting to see how other circuits address the issue when so confronted.

Follow me on Twitter: @devlinhartline

About the author: Devlin Hartline

Devlin is a husband, father, and law geek (JD & LLM). He is currently an SJD candidate at Tulane Law in New Orleans, Louisiana, where he is writing his dissertation on copyright law. He is also a Mark Twain Copyright Fellow at the Center for the Protection of Intellectual Property at George Mason Law in Arlington, Virginia.

1 Comment

  1. It was always going to be ruled that way. Practically every quarter copyright infringement is struck of in a country for Youtube posting up TV clips. If Youtube isn’t in legal trouble for it, your average blogger was never going to jail. One more step for internet freedom for the masses.